Prime money market fund assets, which have declined by a massive $1.066 trillion (-73.1%) over the past 52 weeks, barely moved in the latest week, falling a mere $2.6 billion. Overall money fund assets rebounded in the 7 days ended Wednesday, rising by $16.1 billion, their first gain in 4 weeks. (As we mentioned in yesterday's News, Prime assets have had 2 days of positive inflows over the past week and appear to be poised to begin a gradual rebound.) It appears that the "Big Shift" of assets from Prime and Tax-Exempt MMFs, which lost $1.183 trillion since 10/31/15, and into Govt MMFs, which have gained $1.118 trillion, is coming to a close. We review ICI's latest "Money Market Fund Assets," and also analyze their most recent monthly "Trends in Mutual Fund Investing" and "Month-End Portfolio Holdings of Taxable Money Funds," below. The latter confirms earlier reports of a surge in Repo holdings and plunge in CDs. (See our Oct. 13 News, "Oct. Portfolio Holdings: CDs, CP in Single Digits; Repo Hits Record.")
ICI's latest release says, "Total money market fund assets increased by $16.10 billion to $2.65 trillion for the week ended Wednesday, October 26, the Investment Company Institute reported today. Among taxable money market funds, government funds2 increased by $18.67 billion and prime funds decreased by $2.57 billion. Tax-exempt money market funds increased by $10 million."
It continues, "Assets of retail money market funds decreased by $370 million to $946.81 billion. Among retail funds, government money market fund assets increased by $1.04 billion to $561.70 billion, prime money market fund assets decreased by $1.22 billion to $261.63 billion, and tax-exempt fund assets decreased by $180 million to $123.49 billion."
The update adds, "Assets of institutional money market funds increased by $16.46 billion to $1.70 trillion. Among institutional funds, government money market fund assets increased by $17.62 billion to $1.57 trillion, prime money market fund assets decreased by $1.35 billion to $130.41 billion, and tax-exempt fund assets increased by $190 million to $4.46 billion." Government assets, including Institutional and Retail (and Treasury and Government) stand at $2.131 trillion, while Prime assets now stand at $392 billion.
Year-to-date through Oct. 26, total money fund assets have declined by $107.9 billion, or 3.9%. Prime MMFs have fallen by $891.8 billion, or 69.5%, while Government MMFs have risen by $910.3 billion, or 74.6%. Tax-exempt money market funds have declined by $126.5 billion, or 49.7%. Combined, Prime and Tax-exempt MMFs are down $1.018 trillion, or 66.%, YTD. Prime Institutional assets have lost $744.8 billion in 2016 (-85.1%), while Prime Retail assets have lost $147.0 billion (-36.0%).
ICI's latest "Trends in Mutual Fund Investing - September 2016" shows a $51.1 billion decrease in money market fund assets in Sept. to $2.672 trillion. The increase follows an increase of $18 billion in August and $14 billion in July. In the 12 months through Sept. 30, money fund assets have gone up by $4.6 billion, or 0.2%. (Month-to-date in Oct. through 10/26, our Money Fund Intelligence Daily shows total assets down by $19.2 billion with Prime MMFs down $129.2 billion, Tax Exempt MMFs down $1.4 billion, and Govt MMFs up $111.4 billion.)
The monthly report states, "The combined assets of the nation's mutual funds decreased by $6.65 billion to $16.35 trillion in September, according to the Investment Company Institute's official survey of the mutual fund industry. In the survey, mutual fund companies report actual assets, sales, and redemptions to ICI.... Bond funds had an inflow of $17.68 billion in September, compared with an inflow of $23.08 billion in August.... Money market funds had an outflow of $52.26 billion in September, compared with an inflow of $17.62 billion in August. In September funds offered primarily to institutions had an outflow of $41.54 billion and funds offered primarily to individuals had an outflow of $10.72 billion."
The latest "Trends" shows that while Taxable MMFs overall decreased slightly in September, Tax-Exempt MMFs had another very bad month. Tax-Exempt MMFs declined by $15.3 billion, compared to taxable, which increased by $1.1 billion. Year-to-date through Sept. 30, MMFs have had $82.8 billion in outflows, with $41.0 billion in inflows to Taxable funds and $123.0 billion in outflows from Tax-Exempt funds. Money funds now represent 16.3% (down from 16.7%) of all mutual fund assets, while bond funds represent 22.8%. The total number of money market funds dropped to 416 in Sept., down from 426 in August and down from 503 a year ago.
ICI's Portfolio Holdings confirms a jump in Repo, Agencies and Treasuries in Sept., and continued declines in CDs and CP. Repo remained the largest portfolio segment, rising by $125.4 billion, or 17.2%, to $855.7 billion or 33.6% of holdings. U.S. Government Agency Securities reclaimed second place among composition segments <b:>`_, rising $35.1 billion, or 5.8%, to $642.5 billion, or 25.3% of holdings. Treasury Bills & Securities dropped to third place, gaining $19.9 billion, or 3.2%, to $635.6 billion or 25.0% of holdings. `These increases continued to be fueled by the ongoing shift of Prime fund assets into Government funds last month.
Certificates of Deposit (CDs) stood in fourth place, but decreased $200.6 billion, or 7.7%, to $195.5 billion (7.7% of assets). Commercial Paper remained in fifth place but decreased $70.6B, or 38.4%, to $113.4 billion (4.5% of assets). Notes (including Corporate and Bank) were down by $4.9 billion, or 30.3%, to $11.3 billion (0.4% of assets), and Other holdings fell to $40.6 billion.
The Number of Accounts Outstanding in ICI's series for taxable money funds increased by 633 thousand to 24.547 million, while the Number of Funds fell by 5 to 310. Over the past 12 months, the number of accounts rose by 1.424 million and the number of funds declined by 39. The Average Maturity of Portfolios was 39 days in Sept., up 5 days from August. Over the past 12 months, WAMs of Taxable money funds have lengthened by 4 days. Note: Crane Data also revised its Oct. MFI XLS this week to reflect the latest 9/30/16 Portfolio Composition data and Maturity breakouts. (Visit our Content Center and the latest Money Fund Portfolio Holdings download page to access our Sept. Money Fund Portfolio Holdings and the latest files.)
