Investment accounts, or money market accounts, are similar to savings accounts, but offer better returns while being almost as safe as money kept in the bank. Money in a money market account is put away over a short term, while still providing quick access to finances. The money invested in the money market account is where banks derive capital to lend and borrow large sums of money. The rates of return, though, are better than an average savings account's.
While the bank is using your money for it's own investment purposes over a short term, (promising interest on the amount as a reward), there is less risk than if you're investing directly into stocks yourself. The risk of losing your money in a money market account is the same as that of a savings account – if the bank collapses, your money's gone.
The interest you earn on a money market account is the same as a savings account: calculated daily and then distributed monthly in arrears. The difference is the higher interest rate afforded the money market account.
A money market or investment account requires a larger upfront sum to open than a savings account. Where a savings account can be opened for as little as R50, a money market account usually requires no less than R1000. For recurring investments, you'll have to invest a certain amount each month – usually R1 000 (but some accounts require only R200).
While the risk is less investing in a money market than it is investing in stocks, there is no guarantee that your returns or capital will remain or increase. While it is unlikely that your capital will decrease, it is possible. To avoid this, money market funds invest in a number of financial instruments to remain lucrative. The interest is linked to the interest rates, which means your returns will vary.
The money market still poses more of a risk than a savings account, as money market funds can be linked to other banks or institutions that can collapse, but it does provide more interest and slightly less liquidity than an average savings account.