Dictionary of Finance and Investment Terms: ultra-short-term bond fund
ultra-short-term bond fund
mutual fund buying bonds with maturities typically of one year or less. Such funds usually pay higher yields than money market mutual funds, but lower yields than short-term bond funds. Their advantage to investors is that they offer more price stability than short-term bond funds, along with a yield that beats money funds. The Net Asset Value of ultra-short-term bond funds does fluctuate, however, unlike the net asset value for money market mutual funds, which remains fixed at $1 a share. It is therefore possible to realize capital gains and losses with ultra-shortterm bond funds.
