1. What is Etica Money Market Fund?

The Etica Money Market Fund is a type of mutual fund that invests in short-term, high-quality debt securities. It provides investors with a relatively safe place to invest easily accessible cash-equivalent assets while earning some return.

2. How Does the Calculator Work?

The calculator uses the compound interest formula:

Where:

• \( FV \) — Future Value of the investment
• \( Principal \) — Initial investment amount
• \( Rate \) — Annual interest rate (in decimal form)
• \( Time \) — Investment period in years

Explanation: The formula calculates how much your initial investment will grow over time with compound interest.

3. Importance of Future Value Calculation

Details: Understanding the future value of your investment helps in financial planning, setting realistic expectations, and comparing different investment options.

4. Using the Calculator

Tips: Enter the principal amount in dollars, annual interest rate as a decimal (e.g., 0.05 for 5%), and investment period in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: How often is interest compounded in Etica MMF?
A: Money market funds typically compound interest daily, but this calculator uses annual compounding for simplicity.

Q2: Are money market funds risk-free?
A: While considered very low risk, they are not completely risk-free. There is minimal credit risk and interest rate risk.

Q3: What is a typical return for money market funds?
A: Returns vary with market conditions but are generally lower than other investments, often close to short-term interest rates.

Q4: How liquid are money market funds?
A: They are highly liquid, with most allowing withdrawals within 1-2 business days.

Q5: Are there fees associated with money market funds?
A: Most funds charge expense ratios, typically ranging from 0.1% to 0.5% annually, which are already factored into the yield.