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The August issue of our Bond Fund Intelligence, which was sent out to subscribers Tuesday, features the lead story, "Bond Fund Inflows Continue as ETFs Now 1/8th of Market," which reviews how bond funds keep attracting assets even as returns weaken, and the profile, "Northern High Yield Fund's Camden Avoids the Blowups," which interview Brad Camden of Northern Trust Asset Management. BFI also recaps the latest Bond Fund News and includes our Crane BFI Indexes, which show that bond fund yields and returns moved higher last month. We excerpt from the latest issue below. (Contact us if you'd like to see a copy of Bond Fund Intelligence and our BFI XLS spreadsheet "complement," and watch for details soon on our 3rd annual Bond Fund Symposium conference, which will be March 25-26, 2019 in Philadelphia.)

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The SEC released it latest quarterly "Private Funds Statistics" report recently, which summarizes Form PF reporting and includes some data on "Liquidity Funds." The publication shows a jump in overall Liquidity fund assets in the latest quarter to $579 billion. A previous press release, entitled, "SEC Staff Supplements Quarterly Private Funds Statistics" tells us, "The U.S. Securities and Exchange Commission staff ... published a suite of new data and analyses of private fund statistics and trends. The Private Funds Statistics ... offers investors and other market participants valuable insights by aggregating data reported by private fund advisers on Form ADV and Form PF. New analyses include ... characteristics of private liquidity funds." We review the latest SEC report below, and we also give an update on HSBC's latest European MMF Reform plans.

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According to a new SEC filing, DWS, formerly Deutsche, will convert an existing fund into the first ESG money market mutual fund, one whose investments are guided by environmental, social and governance criteria. A new Prospectus Supplement for the DWS Variable NAV Money Fund says, "The following changes are effective on or about October 1, 2018: DWS Variable NAV Money Fund is renamed DWS ESG Liquidity Fund. All references in the fund's prospectus to DWS Variable NAV Money Fund are superseded with DWS ESG Liquidity Fund. The following information replaces the existing similar disclosure contained in the 'Principal Investment Strategy' section of the summary section of the fund’s prospectus.... The fund is a money market fund that is managed in accordance with federal regulations which govern the quality, maturity, diversity and liquidity of instruments in which a money market fund may invest. The fund does not seek to maintain a stable share price.... Under normal circumstances, the fund invests at least 80% of total assets, determined at the time of purchase, in securities that meet the Advisor’s sustainability criteria."

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Crane Data released its August Money Fund Portfolio Holdings Thursday, and our most recent collection of taxable money market securities, with data as of July 31, 2018, shows increases across all composition segments with big jumps in Treasuries, CP and CDs. Money market securities held by Taxable U.S. money funds (tracked by Crane Data) increased by $90.0 billion to $2.961 trillion last month, after decreasing by $53.8 billion in June, but increasing by $16.7 billion in May and $46.4 billion in April. Repo continued to be the largest portfolio segment, followed by Treasury securities, then Agencies. CP remained fourth ahead of CDs, Other/Time Deposits and VRDNs. Below, we review our latest Money Fund Portfolio Holdings statistics. (Visit our Content center to download the latest files, or contact us to see our latest Portfolio Holdings reports.)

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Crane Data's latest monthly Money Fund Portfolio Holdings statistics will be published later today (Thurs.), and we'll be writing our normal monthly update on the July 31 data in Friday's News. But for months we've also been generating a separate and broader Portfolio Holdings data set based on the SEC's Form N-MFP filings. (We continue to merge the two series, and the N-MFP version is now available via Holdings file listings to Money Fund Wisdom subscribers.) Our summary, with data as of July 31, includes holdings information from 1,275 money funds (up from 1,186 on June 30), representing $3.169 trillion (up from $3.076 trillion on June 30).

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Crane Data's latest Money Fund Market Share rankings show assets were higher for the majority of U.S. money fund complexes in July. Money fund assets overall rose by $36.3 billion, or 1.2%, last month to $3.044 trillion, and assets have risen by $40.3 billion, or 1.3%, over the past 3 months. They have increased by $216.0 billion, or 7.6%, over the past 12 months through July 31, 2018. The biggest increases among the 25 largest managers last month were seen by Northern, JP Morgan, Fidelity, UBS, Vanguard and Dreyfus, who increased assets by $10.7 billion, $8.3B, $7.3B, $6.9B, $6.3B and $5.5B, respectively. We review the latest market share totals below, and we also look at money fund yields in July.

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The August issue of our flagship Money Fund Intelligence newsletter, which was sent out to subscribers Tuesday morning, features the articles: "Rising MF Yields Turn Up Heat on Sweeps, Bank Deposits," which discusses the growing spread between money funds and other cash options; "PGIM Still Rocking in Cash: Q&A w/D'Angelo, Nicholson," which profiles the money funds formerly named Prudential; and, "European MMF Reforms Go Live; Ready for Symposium," which reviews the latest on European money fund regulations. We've also updated our Money Fund Wisdom database with July 31, 2018, statistics, and sent out our MFI XLS spreadsheet Tuesday a.m. (MFI, MFI XLS and our Crane Index products are all available to subscribers via our Content center.) Our August Money Fund Portfolio Holdings are scheduled to ship on Thursday, August 9, and our August Bond Fund Intelligence is scheduled to go out Tuesday, August 14.

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Jason Zweig writes again on brokerage sweep accounts in this weekend's Wall Street Journal "Intelligence Investor" column. The article, entitled, "Your Brokers Can Make 10 Times More on Your Cash Than You Do," and subtitled, "It pays to pay attention to what your brokerage is doing with your cash," tells us, "When some investment firms say they will treat your money as if it were their own, they mean it -- all too well. If the Securities and Exchange Commission wants to make good on its promise to compel brokers to act in their customers’ best interest, it should shine a klieg light on how brokers treat investors’ cash. Investors invest, but of course they leave billions in cash in brokerage accounts, too." (See our March 12 News, "WSJ Hits Brokerage Sweep Rates.")

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With less than 2 months to go before the 6th annual Crane's European Money Fund Symposium, which will be held in London, Sept. 20-21, European money fund reforms and issues have suddenly become the biggest topic in the cash world. European regulatory changes went into effect last week (see our July 23 News, "European Money Market Fund Reforms Go Live; Moody'​s, Fitch Comment"), and money market strategists are handicapping the impacts of changes on cash flows, issuers and fund managers. The FT also wrote this week about one of the major remaining questions marks, whether "share-cancelation mechanisms" are indeed banned under the new rules. We review the latest European Money Fund Symposium agenda and show details below, and we also quote from the FT piece. (Note: We'll be accepting registrations for European Money Fund Symposium all month, but if you plan to attend please make hotel reservations for the Hilton London Tower Bridge asap. Our discounted rate and reserved room block expire on Monday!)

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Since the SEC's Money Market Fund Reforms went into effect two years ago, there have only been a handful of Form N-CR filings, which indicate that financial support has been provided to a money fund. While we have yet to see any true money fund bailouts, we have seen a handful of filings to "top-up" money fund NAVs before liquidations and mergers. The latest filing, and first filing of 2018, is from the $265 million MFS U.S. Government Money Market Fund (MCMXX), which provided a small capital contribution to get rid of a "historical net realized loss" before it could no longer be carried forward. We review the brief MFS U.S. Govt MMF SAI Supplement and the N-CR rule below, and we also quote from a new Citi piece on Muni MMFs, the SIFMA Index and VRDNs.

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Earlier this week, The Wall Street Journal wrote a front-page article entitled, "Jack Ma's Giant Financial Startup Is Shaking the Chinese Banking System." While it didn't deal directly with the giant Yu'e Bao, it did have a number of mentions of Chinese money market funds. The article states, "It handled more payments last year than Mastercard, controls the world's largest money-market fund and has made loans to tens of millions of people. Its online payments platform completed more than $8 trillion of transactions last year—the equivalent of more than twice Germany's gross domestic product. Ant Financial Services Group, founded by Chinese billionaire Jack Ma, has become the world's biggest financial-technology firm, driving innovations that let people use their phones for buying insurance as easily as groceries, enabling millions to go weeks at a time without using physical cash."

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The Investment Company Institute released its latest monthly "Trends in Mutual Fund Investing - June 2018" report yesterday, which shows a $30.1 billion drop in money market fund assets in June to $2.821 trillion. This follows a $58.3 billion jump in May, a $0.4 billion decrease in April, and a $50.1 billion decrease in March. In the 12 months through June 30, money fund assets have increased by $187.5 billion, or 7.1%. (Month-to-date in July through 7/29 assets have increased by $83.3 billion, according to our MFI Daily. But note that we added $63.0 billion in new funds to our collections this month, so July's increase is more like $23.3 billion.) ICI's latest Portfolio Holdings totals also show a big drop in Repo holdings and another drop in Treasuries in June. We review ICI's Trends and Portfolio Composition statistics below, and we also quote from a new S&P update on SOFR-linked securities.

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