Investors increasingly withdrew their money out of short-term financial instruments, such as money market funds, throughout last month on worries over lackluster corporate earnings, data showed Sunday.

Money market funds are short-term debt securities, such as Treasury bills and commercial papers. They are widely considered as safe as bank deposits yet provide a higher return.

MMFs have enjoyed popularity after the key interest rate was cut to a record low of 1.5 percent, with their net asset value hitting a record high of 122.62 trillion won ($103.6 billion) on Aug. 19, according to the Korea Financial Investment Association.

The trend has changed, however, as major shipbuilders and exporters were expected to post sluggish profits in the third quarter, seeing the total asset fall to 101.23 trillion won at the end of September, the KFIA said.

Market watchers say the capital outflow from the short-term vehicle is to continue as the U.S. Federal Reserve was on track to raise interest rates later this year.

"MMF attracted investment under the low-interest rate environment, but worries over lackluster earnings prospect sapped the appetite for riskier assets," Oh On-soo, an analyst at Hyundai Securities, said. (Yonhap)