A money market account (MMA), sometimes called a money market deposit account (MMDA), is a particular interest-bearing account that pays relatively high-interest rates.
MMAs are not marketable securities though they contain money market securities. Traditional banks, online banks, and credit unions are depository institutions that offer these accounts.
Although they sound similar and cause some confusion, money market accounts and mutual funds have notable differences in insurance coverage, returns, and risk.
When you open a brokerage account or have a mutual fund, safety comes from SIPC if the brokerage firm fails to $500,000 per customer per separate capacity account.
The respective bank or credit union sets the interest rate and therefore is a guarantee for the MMA, whereas the money market mutual funds’ performance is its returns.