‘The return of cash’ – money market fund sector perks up on rising rates

  • 📰 globeandmail
  • ⏱ Reading Time:
  • 56 sec. here
  • 2 min. at publisher
  • 📊 Quality Score:
  • News: 26%
  • Publisher: 92%

United States News News

United States United States Latest News,United States United States Headlines

Increasing returns have allowed fund managers to start charging more just in time to profit as customers fleeing turbulent markets move their holdings into cash

. Get exclusive investment industry news and insights, the week’s top headlines, and what you and your clients need to know.

But rising returns have allowed fund managers to start charging more just in time to profit as customers fleeing turbulent markets move their holdings into cash. The change “will provide a significant tailwind because rising rates mean fund providers will finally be able to stop subsidizing money market funds,” says Tim Armour, chief executive officer of Capital Group, which manages US$27-billion in money market funds.

“We’ve seen the return of cash as a strategic asset. What we’re seeing is money in motion,” said Gary Shedlin, BlackRock’s chief financial officer, in an interview. The same trends are showing up elsewhere. Fidelity Investments Inc., the global leader with more than US$900-billion in money market assets, says that “the majority of our funds have exited fee waivers since the last Federal Reserve rate hike.”

Although big providers are reporting inflows to their cash management services, money market funds as a whole are not seeing an increase. There was US$4.6-trillion parked in money market funds on July 13, basically the same as in February, ICI data show.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.
We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 5. in US

United States United States Latest News, United States United States Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Calgary hot housing market bids goodbye to bidding wars amid cool down - Calgary | Globalnews.caCalgary's once sizzling resale housing market sees a cool down amid rising interest rates leading to decreased bidding wars and asking prices. Still think the homes in school zones are still in high demand, no one wants a long commute for their kids
Source: GlobalCalgary - 🏆 50. / 61 Read more »