Explainer
What is a money market fund? A plain-English guide for Uganda
Updated 2 Nov 2026 · 2 min read · By Capital & Context editorial team
A money market fund is a type of unit trust. It pools money from many savers and a licensed fund manager puts it into short, low-risk loans such as treasury bills, fixed deposits and short bonds. Each saver owns units in the fund, and the value of those units grows as the loans earn interest.
Why do people use money market funds?
- Access. Many funds pay withdrawals within a few working days.
- Small amounts. Many funds accept small starting amounts and regular top-ups.
- Wholesale rates. The fund can lend at rates individual savers often can't get on their own, for example in treasury bills.
The highest UGX fund yield we track is 12.55% (Old Mutual Umbrella Trust Fund, Old Mutual only, before tax, fund manager, 20 Oct 2026). See all the yields we track on our unit trust rates page.
Who regulates them?
Unit trusts in Uganda are collective investment schemes licensed by the Capital Markets Authority (CMA). Each fund has a licensed manager who makes the investment decisions, a trustee who looks after investors' interests, and a custodian who holds the assets apart from the manager's own money. Before investing, check the manager is on the CMA's licensed list.
What will I earn?
Funds publish a yearly yield, often updated daily. It is a recent result, not a promise, and it moves as interest rates move. Ask how fees are taken: some yields are shown after the manager's fee, some before. Tax on unit trust profits is being confirmed (we haven't confirmed how profits from unit trusts and money market funds are taxed, so we show it before tax).
What are the risks?
- Returns can fall when interest rates fall.
- No deposit protection. Bank deposits are covered up to UGX 10,000,000 (per person, per bank, Deposit Protection Fund of Uganda, checked 2 Nov 2026), but unit trusts are not covered by the Deposit Protection Fund.
- Fees reduce what you keep. Look for the management fee in the fund's fact sheet.
Money market fund or fixed deposit?
A fixed deposit gives you a set rate for a set term. A money market fund gives you flexibility, but the return moves. Our unit trust vs fixed deposit calculator grows the same savings plan in both, and our guide to unit trusts vs fixed deposits compares access, safety and tax.