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Archive for Sunday, October 28, 2001

The Motley Fool

October 28, 2001

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Last week's question, answer

Founded in 1922 and based in Bloomington, Ill., I'm a mutual company, meaning that I'm owned by my customers. I'm the No. 1 insurer of homes and cars in America, and I even sell mutual funds. I employ nearly 80,000 people, and more than 16,000 good neighbors have sold about 70 million policies for me in North America. I'm one of the world's largest financial institutions. Who am I? (Answer: State Farm)

Know the answer? Send it to us with Foolish Trivia on the top and you'll be entered into a drawing for a nifty prize! The address is Motley Fool, Box 19529, Alexandria, Va. 22320-0529.

Money market funds

Q: What's a money market fund? K.B., Hartsville, S.C.

A: A money market fund is a mutual fund that buys securities such as Treasury bills, short-term commercial debt and certificates of deposit. It sticks to short-term, high-quality securities and is relatively safe and liquid. Money market yields vary according to short-term interest rates and typically exceed rates offered by standard bank accounts. But they fall dramatically short of the stock market's historical average annual return of 11 percent. They're great for short-term investments, but ill-suited for long-term savings. Learn more about short-term savings and find good rates at www.Fool.com/savings/savings.htm and www.bankrate.com.

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