Fund Directions - Money Fund Proposal Could Put Boards On Spot

Money Fund Proposal Could Put Boards On Spot

The Securities and Exchange Commission has proposed that money market fund boards declare whether their funds sell to "retail" or "institutional" investors. The SEC revealed the proposal as part of a nearly 200-page document of reforms posted on its Web site. The SEC said if the liquidity requirements it is calling for now had been in place during this past fall's crisis, funds would have been able to satisfy more than 90% of the demands presented to them for redemptions without having to sell portfolio securities.

The proposal would require institutional funds to have twice as much liquidity as retail funds. The split level ...

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Money Fund Proposal Could Put Boards On Spot