8 min readMoving corporate cash to boost returns by a basis point or two could earn a CFO or treasurer a well-deserved dressing-down. But that doesn’t mean that finance executives who manage growing pools of idle cash can stand pat with their current investing strategies. Safety and liquidity require constant vigilance — maybe even more so this…
2 min readTEXT OF INTERVIEWS Stacey Vanek-Smith: This morning, some not so good news. Consumer plunged in September, its biggest drop in nine months. Now that’s a big deal considering consumer spending makes up about 70 percent of our economy. To help us suss this out is Lance Pan. He’s the director of investment research at Capital…
8 min readOn February 7, 2008, Joseph Broce, assistant treasurer of Ashland Corp., authorized Oppenheimer Co. to buy $15 million worth of auction-rate securities (ARS) on Ashland’s behalf. The money was from a 2005 asset sale that netted the chemical company more than $1 billion in cash. Ashland wanted to keep the money close at hand as…
8 min readThe Securities and Exchange Commission is considering making significant changes to money market mutual funds because there is still a danger that these funds could be unable to meet redemptions when investors begin to step off the sidelines en masse and move back into equity markets. At a seminar on money market funds held last…
4 min readFinancial advisers are at risk of getting caught in a classic “bond bear trap” — reaching for yield in a low-interest-rate environment, then getting hammered when rates ultimately rise. “We see this time and time again — when the Fed lowers rates, people go out very long [on the yield curve] and lower the bar…
2 min readExpect lower yields from money market mutual funds in the coming months as a result of reforms being contemplated by the SEC and Investment Company Institute, according to a white paper released this month and announced today by Capital Advisors Group Inc. of Newton, Mass. Proposals from the Washington-based ICI to reduce average portfolio maturities,…
1 min readWith money fund assets at a record high, the guarantee program prompted by the Primary Fund’s troubles is expected to be extended, possibly to Sept. 18 ¿ a year after the guarantees started. Fund companies have paid more than $800 million so far in fees to extend government backing to their funds and bolster investor…
5 min readBattered by volatile markets and burned by flaws in structured debt, companies face hard choices about where to invest cash. They commonly have three priorities now, say experts: liquidity, capital preservation, and transparency. “If an investment has the hint of structure, treasurers will pass on it,” says Karl D’Cunha, a senior managing director at Houlihan…
5 min read“For years, corporate investors stuck to what were considered safe investments. Now we know that nothing is safe,” says Lee Epstein, president and CEO of Money Market One, a broker-dealer based in San Francisco that specializes in corporate cash. “You have to consider that the unthinkable can happen. It’s the new paradigm.” And that uncertainty…
2 min readNot surprisingly, most corporate financial execs today are placing safety and liquidity top-of-mind when choosing between investments, says Ben Campbell, president of Capital Advisors Group, a Newton, Mass.-based investment advisory firm. Late last year, in fact, CFOs aggressively moved to quality, as evidenced by Uncle Sam’s December auction of $30 billion worth of 1-month Treasury…