Cash Is Pouring Out of Money-Market Funds. What’s Hot Instead.

By Karishma Vanjani – Barrons

Money-market funds, which invest in short-term, high-quality securities, such as certificates of deposit and government debt maturing in one year or less, saw their first weekly outflow in nine weeks, with a net withdrawal of $7.5 billion for the week ended Wednesday.

The change represents a reversal because money-market funds had been the go-to for earning a quick buck on cash since 2022.

The shift coincides with the Federal Reserve’s half percentage-point interest rate cut last week. 

Dividend-focused stock funds had the highest inflow in 24 weeks.

Cryptocurrency funds had their largest inflow in nearly two months.