Money market and short duration bond funds are investment funds that hold high quality and low volatility fixed income instruments. There are no lock-ups for these funds.
Money Market Fund (very low risk):
A money market fund invests primarily in a diversified portfolio of institutional bank fixed deposits, as well as high quality investment-grade and very short duration government and corporate debt instruments. They are diversified across varying issuers and tenures maintaining a weighted average duration of around 12 months or less. Money market funds are considered to be very low risk in nature.
Short Duration Bond Fund (low risk):
A short duration bond fund invests primarily in a diversified portfolio of institutional bank fixed deposits, as well as high quality and investment-grade short duration government and corporate debt instruments. They are diversified across varying issuers and tenures maintaining a weighted average duration of around 24 months or less. Short duration bond funds are higher risk than money market funds but still considered to be low risk in nature.