fbpx

Equity Funds Vs Money Market Funds

A few years ago I invested 5000 PKR each into an equity fund (MIF) and an interest-bearing money market fund (MIIF) by Al Meezan. The goal was simple; to publish data here to see (and show) how they do over the mid-term and long-term.

The investment is now live for about 40 months or a little over 3 years.

As can be seen, MIF (equity fund) has generated about the same returns as MIIF (interest-bearing money market fund) even during the (very) high interest-rate environment. Over a very long period (10-20 years), I suspect that the equity fund would significantly outperform the interest-bearing money market fund. The total investment is up over 42% – whether you had chosen an equity fund or a money market fund.

The point is simple really; if you dislike buying interest-bearing instruments, there are still plenty of things you can (and should) do to protect your purchasing power.

Leave a Reply