MoneyRates Blog
Bank Money Market Rates Outpacing Yields on Money Funds
By Clark Schultz | Money-Rates Columnist
Mutual fund money markets have had a tumultous six months. A perfect storm arose to test the whole industry. First, the safety of money funds was called into question after several funds “broke the buck” during the mortgage-backed securities crisis. Then yields on money funds were pushed down close to 1% after the Fed lowered [...]
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Major Money Fund Drops NAV Below $1
By MoneyRates team | Money-Rates Columnist
The devastating week for financial companies continued today after Primary Reserve Primary Fund became the first money-market fund in 14 years to drop their net asset value below $1 after writing off $700 million of debt issued by bankrupt Lehman Brothers Holdings Inc. and experiencing large withdrawals. Primary Reserve Fund is actually the oldest money [...]
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Mutual Fund Companies Bail out their Money Market Funds
By MoneyRates team | Money-Rates Columnist
Major companies like Bank of America Corp, Legg Mason, Inc., SunTrust Banks Inc., and Citigroup Inc. are reported to have been forced to invest funds into their own money market funds to prop up the net asset value at a stable $1 after incurring losses in a complex financial instrument called SIVs or Structured Investment [...]
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Buying a Money Market Fund
By MoneyRates team | Money-Rates Columnist
The financial headlines have been full of stories about the trouble experienced by a number of money funds. Large companies like Bank of America Corp. and Legg Mason Inc. among others have been forced to infuse their money market funds with money to cover for losses and prevent having to “break the buck” and allow [...]
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Safety and Money Market Funds
By MoneyRates team | Money-Rates Columnist
Money Market Funds have a long and distinguished history of maintaining a price or NAV (Net Asset Values) of $1 comforting investors that their funds, while not federally insured, are extremely safe. The recent panic in the mortgage-backed securities industry has caused some scrutiny of money market funds and their ability to meet liquidations and [...]
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