5 min readExecutive Summary Important regulatory changes to institutional prime money market funds are forcing new ideas and new interest in prime fund alternatives. With the SEC Form PF aggregate data, we reconstructed a profile of unregistered private liquidity funds promising investors stable $1.00 NAVs without liquidity gates. We discuss the drawbacks with private funds as being…
4 min readAbstract Recent events serve as a prelude to what is to come from the new administration. Active cash portfolio management with a separate account solution helps manage policy uncertainty, market volatility, headline and geopolitical risk. Fiscal and monetary policies, international relations and political conflicts may bring more uncertainty in 2017 than in other recent years….
4 min readRemember the debt ceiling fights of 2011 and 2013? They may be in the back of many investors’ minds now, but will likely be front and center again leading up to March 15, when the suspension of the federal government debt ceiling expires. Any institutional cash investor who lived through those earlier Congressional standoffs knows…
4 min readAbstract We select Trumponomics, the debt ceiling rollercoaster and geopolitics as three main themes to watch in 2017. Federal stimulus may in fact be underwhelming and a stronger dollar and trade wars may further erode the effect of increased government spending. The immense size of government money market funds ($2.2 trillion) may present challenges throughout…
2 min readAbstract Policy, geopolitical, and idiosyncratic risks are real under the new administration. It is too soon to tell if the next four years will be friendly to cash investors. The economic drag from trade barriers and immigration control may offset some benefits from a federal stimulus and a pro-business Republican agenda. A potentially bifurcated outcome…
1 min readAbstract Important regulatory changes to institutional prime money market funds are forcing institutional cash managers to look elsewhere. While ultra-short bond funds hold promises, they exhibit many of the same drawbacks of commingled vehicles. A well-researched and well-structured separately managed account may overcome these drawbacks while delivering comparable or better benefits. Commingled vehicles and separate…
2 min readAbstract An Industry at an Inflection Point – Outflows from prime funds have been more severe than forecast. Fewer funds and fewer fund companies are left in the prime space. While stable NAV government funds will likely continue to flourish, the appeal of prime funds has diminished. Diminished Yield Potential – The anticipated higher prime-to-…
1 min readAbstract This introductory product brief discusses insured deposit programs’ potential safety, liquidity, yield, diversification and ease of use benefits. It also cautions on their servicer risk, liquidity, size restrictions, risks related to FDIC payoffs and sustainability. Such vehicles may be well suited for moderate-sized accounts with government mandate that desire higher yield potential than government…
3 min readAfter an initial shock, global financial markets calmed down in the week following the June 24 vote by the British electorate to leave the European Union (Brexit). As leaders from the United Kingdom and EU began a process of separation that could take several years, the immediate impact on institutional cash investors was only mildly…
2 min readAbstract We leave our readers managing intuitional cash portfolios with the following takeaways: Brexit will likely have a major impact on the UK, politically, economically and financially. It is less so on the EU and the US. Look for short-term volatility and maintain sufficient liquidity as market liquidity may be less predictable than before. Expect…