Media – Whitepapers
January 2, 2007
Executive Summary As 2006 drew to a close, corporate cash investors found themselves in a surprisingly benign market. Despite the 100 basis-point increase in the Fed funds rate, major short-duration bond indices brought in positive returns almost universally. As managers of corporate cash investments, we picked five trends that reflect
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December 1, 2006
Executive Summary We set out to answer 10 of the most common questions related to investment policy statement writing for cash portfolios. In doing so, we will provide a number of peer group data comparisons to further add helpful insight in the process. The questions address the following investment subjects:
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October 1, 2006
Executive Summary Results of three studies examining investment returns show that, in aggregate, investors with tax rates above 23% received higher returns from tax-exempt securities than from taxable investments over the last nine years. The annual return advantage for taxpayers in the top tax bracket (35%) was approximately 0.26%. While
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September 1, 2006
Executive Summary Few financial executives have a firm grasp of what liquidity means in a portfolio of individual cash assets. The two main criteria in measuring liquidity are: 1. how long it takes to convert an asset to cash, and 2. how much of a price “haircut” must be taken
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April 1, 2006
Executive Summary Since the introduction of the first fund in 1972, institutional money market funds have gained a well deserved position in most corporate cash portfolios, thanks to their safety, constant share price, liquidity, and competitive yield. But money market fund investing is not risk-free. In the last 15 years,
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March 1, 2006
Executive Summary Compared to past periods, the yield curve inversion we are experiencing is quite benign. Therefore, there need not be profound concerns that an economic recession will automatically derive from this phenomenon. After the Fed funds rate reaches its peak in the coming spring-summer timeframe, one can expect the
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December 30, 2005
Executive Summary There are generally two ways of calculating investment returns. Mutual funds, pension plans, and investors with total return objectives predominantly use the market value based method. Money market funds, cash portfolios, insurance accounts and investors seeking income stability tend to rely on book value based returns. Sometimes, an
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July 13, 2005
Executive Summary The most compelling argument for total return strategies is demonstrated by a difference of 1.73% in annualized returns between the 1-month and the 1-3 year Treasury benchmarks in the 1995-2004 period. The return difference translates into $26.6 million for a hypothetical investment with a starting value of $100
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May 26, 2005
Executive Summary ABCP can be a good investment choice in large corporate treasury accounts due to the depth, liquidity, flexibility, and yield potential of the asset class. ABCP gained popularity recently because increased event risk of corporate names resulted in concern about unsecured commercial paper. A potential investor of ABCP
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January 27, 2005
Research Highlights The ratio of roughly 3 to 1 single-A vs. double-A issuers suggests a liquid market sector and potential for better risk diversification. One-year default probability but a single-A corporate issuer was 0.02% in the last 10 years. Investing in single-A securities would have increased cumulative credit losses by
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