Despite a Booming Stock Market: Rush for US Money Market Funds

Last Updated: 14. Dezember 2023By

At the US lead stock exchange something very unusual is happening. No, I’m not talking about the performance of the US lead index S&P 500, which currently shines with a 12-month return of a whopping +14.3%.

Of course, this is more than twice as much as the index usually achieves in a year. So US stock investors can really be very satisfied. And possibly buy even more stocks.

But now comes the unusual: Instead of this, these investors prefer to shift their money into money market funds. And at record speed, according to the latest data from the Fed St. Louis.

US investors shovel their money into money market funds Money parked in money market funds just reached a new all-time high. These have grown by more than 20% in the past 12 months. This is unusually fast.

Despite great stock exchanges: new all-time high in „cash“! Source:

Well, the money market is basically „cash“ (with interest). This is where money is often shifted when investors flee from the risk of stocks or bonds to safety. Because in the money market the fluctuations (and unfortunately also the returns) are extremely limited.

What does this mean for your stocks? But if investors are still massively fleeing into cash despite the good performance of stocks, then something could be wrong with the current rally.