Reich & Tang has filed to launch what appears to be the second "ultra-short" money market fund, RNT Natixis Liquid Prime Portfolio. (See our Oct. 1 News "JPMorgan Rolls Out Ultra-Short Money Mkt Fund, Enhanced Cash Fund".) The new RNT fund, which was just rated AAA by S&P, will have a maximum WAM of 9 days, daily transparency of holdings, and a 5:30pm cut-off time for purchases.
In a release entitled, "RNT Natixis Liquid Prime Portfolio Rated 'AAAm', S&P says, "Standard & Poor’s Ratings Services said today that it assigned its 'AAAm' principal stability fund rating to the Daily Income Fund - RNT Natixis Liquid Prime Portfolio. The fund is scheduled to launch on Nov. 30, 2010. The 'AAAm' rating, the highest assigned to principal stability funds, is based on our analysis of the fund's credit quality, market price exposure, and management."
S&P continues, "Reich & Tang Asset Management LLC (RTAM) is the investment manager for the fund. RTAM has been an investment adviser since 1970 and as of Sept. 30, 2010, had approximately $11.6 billion in assets under management. RTAM is a direct subsidiary of Natixis Global Asset Management. Natixis Global Asset Management had approximately $719 billion in assets under management as of Sept. 30, 2010. In addition to this newly rated fund, RTAM manages two other 'AAAm' rated principal stability funds. The custodian for the fund is the Bank of New York, and Reich & Tang Distributors Inc. is the distributor."
S&P explains, "The RNT Natixis Liquid Prime Portfolio seeks to provide as high a level of current income to the extent consistent with the preservation of capital. The fund is unique in that, under normal market conditions, it will maintain a maximum dollar-weighted average maturity and dollar-weighted life of nine days or less and offer daily transparency of holdings. Eligible investments include securities issued or guaranteed by the U.S. government, its agencies or instrumentalities; debt securities issued by U.S. and foreign banks, including certificates of deposit, commercial paper, time deposits, and other short-term securities and repurchase agreements collateralized by securities issued or guaranteed by the U.S. government, its agencies, or instrumentalities. The fund is not permitted to invest in asset backed commercial paper, asset-backed securities, collateralized loan obligations, or loan participation notes. The fund's credit quality is excellent, with more than 50% of the securities invested in 'A-1+' rated securities and the remainder in 'A-1' rated paper. The RNT Natixis Liquid Prime Portfolio is available in two share classes: Liquidity Class (LIQXX), which offers a 5:30 p.m. EST cutoff [and an 18 bps expense ratio]; and Treasurer Class (LQTXX), which has a 12:30 p.m. cutoff and a 15 basis point expense ratio."
Finally, the release says, "The 'AAAm' rating reflects the fund's extremely strong capacity to maintain principal stability and to limit exposure to principal losses due to credit risks. This is achieved through conservative investment practices and strict internal controls. We review pertinent fund information and portfolio reports weekly as part of our ongoing rating process." (Note that Crane Data has begun tracking the new JPMorgan Current Yield Money Market Fund (JCCXX) -- look for statistics in our November Money Fund Intelligence XLS -- and that we will begin tracking the new RNT fund following its launch.)
