A TAXING MATTER
In this chapter, we look at bond funds from the point of view of their taxable status and, within that status, consider the different portfolio types. When comparing the returns on bond funds, it is very important to examine their portfolios to understand why the returns are different. As you will see, types of bond portfolios may be presented in more than one format, which we point out as we describe each one. The fund types are presented in alphabetical order.
Money Market Mutual Funds: Taxable and Tax-Exempt
Money market mutual funds come in two primary varieties: taxable and tax-exempt. Often viewed as if they are cash, they are actually mutual funds that invest in very short-term securities.