Lightyear Savings offers you to invest in money market funds (MMFs). It is available in Austria, Estonia, Finland, France, Germany, Hungary, Italy, Lithuania, Luxembourg, Netherlands, Spain and the UK – countries where these funds are registered locally by BlackRock. If available, you can see Savings in your Portfolio tab.

What is a Money Market Fund?

Money Market funds (MMFs) invest in a large basket of short term bonds from financial institutions or governments. Lightyear offers funds with highest ratings that can be assigned to a product of this type, to see the specific rating of an MMF go to the relevant instrument page and scroll to the Exposure section.

Things to know about MMFs

• MMFs are not traded on an exchange, instead these funds are traded with the issuer itself and priced daily
• Most transactions happen within minutes. In rare cases, they are processed the next business day. You can review all deposits and withdrawals in the Savings activity
• MMFs, while highly liquid, are not cash deposits and come with their own risks. As with any investment, your capital is at risk and you should seek professional advice if unsure

Fees and interest

• Fund size is the total market value of the assets (both invested and held in cash) possessed by the fund
• Yield
  • 1-day yield is the average rate of return of this fund over the prior day, if held for one year. It’s calculated by multiplying the daily dividend factor by 365
  • 7-day yield is the average income return over the previous seven days, if the rate stays the same for one year. It's calculated by taking the accumulated dividend factor for the past seven days, multiplying it by 365, then divided by 7
  • The yield on an instrument tab if you search an MMF in the app shows the gross percentage
  • The yield in Savings shows APY (Annual Percentage Yield) which is the estimated compounding percentage, excluding any BlackRock and Lightyear fees
• For all fees and potential for earnings when putting your money in a specific MMF, go to the relevant instrument page and scroll down to the % Interest calculator in the app. See also our Pricing page
• Net asset value (NAV) is a calculation used to understand the per-share value of that fund

Interest and withdrawal

The interest distribution is paid to your Lightyear account on the first business day of every month and is automatically reinvested to the same fund. If you want to disable the auto-reinvesting function, you can do that in the Savings feature in the app. If you place a withdrawal from your Savings, the funds will go to your Lightyear Cash balance.

Taxes

• Lightyear cannot give tax advice as it always depends on your personal circumstances and local tax laws
• Returns earned from MMFs may be classified differently depending on your jurisdiction and tax authority you’re reporting to. Seek local professional advice if unsure
• See more about this topic here: Taxes and statements

How do I find an MMF in the Lightyear app?

• In your Savings tab in your Portfolio (if you have a business account, it’s called BlackRock Money Market Funds)
• Write the MMF you’re looking for in the search bar