Crane Web Access

Crane Web Access Sample A press release entitled, "Moody's assigns Aaa-mf rating to HSBC US Dollar ESG Liquidity Fund," tells us, "Moody's Investors Service has assigned an Aaa-mf rating to HSBC US Dollar ESG Liquidity Fund, a new low volatility net asset value money market fund, domiciled in Ireland and managed by HSBC Global Asset Management (USA) Inc. This Fund is classified as Article 8 under the European Union Sustainable Finance Disclosures Regulation and must, as such, promote environmental or social characteristics. The Fund's primary investment objective will be to maintain the principal and to provide shareholders with daily liquidity with an income which is comparable to US Dollar denominated short dated money market interest rates." Moody's explains, "The Aaa-mf rating reflects Moody's view that the Fund will have a strong ability to meet its objectives of providing liquidity and preserving capital. This view is supported by the model portfolio's high scores for each of the key rating factors, including credit quality, asset profile, liquidity and exposure to market risk. The Fund will invest in a diversified portfolio of short-term securities, instruments and obligations which are of high quality at the time of purchase, with an additional focus on the performance of the underlying issuers on a range of ESG (environmental, social, governance) metrics. HSBC Global Asset Management (USA) Inc., the Fund advisor, determines an ESG score for each issuer in the universe, made up of individual E, S and G scores and weighted based on a proprietary model. The Fund's eligible investment universe will be limited to issuers that score in the top three quartiles based on the aggregate ESG score, while the issuers in the bottom decile for each individual component of E, S and G will also be excluded. The Fund's weighted average maturity will be below 60 days and we expect the Fund to maintain a strong liquidity profile supported by high levels of overnight and weekly liquidity in the portfolio. As a result, we expect the Fund to have a very low exposure to market risk." The release adds, "The rating agency expects the Fund will be managed in line with the model portfolio. However, Moody's notes that if the Fund's investment portfolio was to deviate materially from the model portfolio, the Fund's rating could be changed. The Fund will be launched on 12 October 2022. It will operate under the low volatility net asset value (LVNAV) fund structure domiciled in Ireland and offer a same day settlement. Moody's expects modest shareholder concentration risk during the Fund's ramp-up period to diminish as the Fund grows in size and its shareholder base diversifies. HSBC Global Asset Management (USA) Inc., the fund's investment advisor, is part of the asset management business of HSBC Holdings plc that had $595 billion in assets under management worldwide as of 30 June 2022, of which about $146 billion are invested in liquidity funds."

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Crane Web Access News

Jun 07
 

The June issue of our flagship Money Fund Intelligence newsletter, which was sent out to subscribers Friday morning, features the articles: "Allspring, UBS, Dreyfus, DWS All File Plans to Leave Prime," which covers the continued exodus from Prime Institutional MMFs; "ICI 2024 Fact Book Shows Money Fund Trends in '23," which quotes from ICI's annual compilation of fund statistics; and, "Money Funds Largest Buyers of T-Bills Says JPM; Berkshire," which looks at holders of Treasuries. We also sent out our MFI XLS spreadsheet Friday a.m., and we've updated our Money Fund Wisdom database with 5/31/24 data. Our June Money Fund Portfolio Holdings are scheduled to ship on Tuesday, June 11, and our June Bond Fund Intelligence is scheduled to go out on Monday, June 17. (Note: Register ASAP for our Money Fund Symposium next week in Pittsburgh, June 12-14. We hope you'll join us!)

MFI's "Prime Exit" article says, “Another batch of Prime Institutional money market funds filed to liquidate or convert to Government in May, bringing the total of Prime exits to 10 to date. Allspring, formerly the Wells Fargo Funds, is the latest to announce an exit ahead of the SEC's pending emergency mandatory liquidity fee rules (which go into effect October 2). A Product Alert titled, 'Allspring to Merge Two Money Market Funds' tells us, 'The Allspring Funds Board of Trustees has approved the merger of the [$3.1 billion] Allspring Heritage Money Market Fund into the Allspring Government Money Market Fund. The merger is expected to take place at the close of business on or around August 16, 2024."

The piece continues, "It adds, 'Note that the Service Class of the Heritage Money Market Fund will merge into the Administrator Class of the Government Money Market Fund, and the Administrator Class of the Heritage Money Market Fund will merge into the Institutional Class of the Government Money Market Fund.' (See the Prospectus Supplement for the Allspring Institutional Money Market Funds.)"

We write in our ICI 2024 Fact Book article, “The Investment Company Institute released its '2024 Investment Company Fact Book’ an annual compilation of statistics and commentary on the mutual fund space. Subtitled, 'A Review of Trends and Activities in the Investment Company Industry,' the latest edition tells us, 'Worldwide net sales of money market funds totaled $1.5 trillion in 2023, up from $161 billion in 2022 (Figure 1.7). The increase in worldwide demand for money market funds was spread across all geographical regions but was primarily driven by a substantial increase in net inflows in the United States. Investor demand for money market funds in the United States increased from $1 billion in 2022 to $1.1 trillion in 2023. In the Asia-Pacific region, money market funds experienced net inflows of $136 billion in 2023, about even with the net inflows of $132 billion in 2022.'"

ICI continues, "It explains, 'Investors use money market funds because they are professionally managed, tightly regulated vehicles with holdings limited to high-quality, short-term debt instruments <b:>`_. As such, they are highly liquid, attractive, cash-like alternatives to bank deposits. [D]emand for money market funds is dependent upon their yields and interest rate risk exposure relative to other high-quality fixed-income securities.'"

Our "Treasury Bills" piece says, "J.P. Morgan's most recent 'Short-Term Market Outlook And Strategy' writes that, 'Yes, T-bill demand should remain robust.' They comment, 'While the outcome of the upcoming November election remains highly uncertain, the one thing we know is that the US fiscal deficit will remain large in the coming years, regardless of who wins. As our Treasury strategists note, given Treasury's current net coupon borrowing capacity and their estimates of the budget deficit forecasts over the medium term, Treasury will likely remain underfunded in FY26 and beyond.... Reading between the lines, it appears there is a possibility that the T-bill share of the market could migrate above the current recommended range over time.'"

It tells us, "The piece continues, 'If so, we believe the markets will have no issues digesting the additional T-bill supply, with demand remaining robust. Indeed, even as T-bill outstandings have grown by $2tn over the past year, the impact on T-bill/SOFR spreads has been marginal thanks to the available pool of liquidity at the ON RRP, underscoring the sheer amount of demand for T-bills in the current market environment.... Perhaps more importantly, when we look at the buyer base of the T-bill market, we see the demand from several key buyers remaining substantial, if not expanding, in the near term.'"

MFI also includes the News brief, "MMF Assets Rebound in May." It states, "Money fund assets jumped $79.7 billion to $6.466 trillion in May (after falling $17.6 billion in April and $68.5B in March). Year-to-date, MMFs are up by $147.3 billion, or 2.3%. Over 12 months, money funds have risen by $611.3 billion, or 10.4%."

Another News brief, "Citi's Williams on Impact from MMF Reforms: No Big Deal; Assets Higher. Citi Research recently published a research piece titled, 'Short-End Notes Impact from MMF reform and AUM expectations,' which tells us, 'Do not expect a repeat of 2016 this October.' Author Jason Williams writes, 'We've gotten multiple questions on the front-end impact due to the full implementation of the new money market fund reform, specifically the SEC's liquidity fee which is set to turn on in October.'"

A sidebar, "DWS ESG Fund Liquidating," says, "A Prospectus Supplement filing for the $505 million DWS ESG Liquidity Fund tells us, 'Upon the recommendation of DWS Investment Management Americas, Inc., the investment advisor for DWS ESG Liquidity Fund, the Board of Trustees of Investors Cash Trust has authorized, on behalf of the fund, the fund's termination and liquidation, which will be effective on or about August 14, 2024. Accordingly, the fund will redeem all of its outstanding shares on the Liquidation Date. The liquidation will be effected according to a Plan of Liquidation and Termination. The costs of the liquidation, including the mailing of notification to shareholders, will be borne by the fund but reimbursed by the Advisor, after taking into account applicable contractual expense caps.'"

Our June MFI XLS, with May 31 data, shows total assets increased $79.7 billion to $6.466 trillion, after decreasing $17.6 billion in April, $66.7 billion in March, increasing $50.0 billion in February, $87.0 billion in January, $24.5 billion in December and $219.8 billion in November. Assets decreased $39.3 billion in October, but increased $77.8 billion in September, $104.2 billion in August, $21.0 billion in July and $20.3 billion in June.

Our broad Crane Money Fund Average 7-Day Yield was unchanged at 5.03%, and our Crane 100 Money Fund Index (the 100 largest taxable funds) was up 1 bp to 5.14% in May. On a Gross Yield Basis (7-Day) (before expenses are taken out), the Crane MFA and the Crane 100 averaged 5.40% and 5.41%, respectively. Charged Expenses averaged 0.37% and 0.27% for the Crane MFA and the Crane 100. (We'll revise expenses on Monday once we upload the SEC's Form N-MFP data for 5/31/24.) The average WAM (weighted average maturity) for the Crane MFA was 34 days (down 1 bp from previous month) and the Crane 100 WAM was unchanged at 35 days. (See our Crane Index or craneindexes.xlsx history file for more on our averages.)

May 07
 

The May issue of our flagship Money Fund Intelligence newsletter, which was sent out to subscribers Tuesday morning, features the articles: "Goldman Latest Prime Inst Exit; CP/CDs Should Be Okay," which covers the continued exodus from Prime Institutional MMFs; "Corporate Treasurers Leaning Away from Prime, to SMAs," which quotes from recent TEXPO 2024 & NEAFP conferences; and, "NY Fed Says Money Funds in Europe Reflect Rates Fast Too," which reviews an article from The Federal Reserve Bank of NY. We also sent out our MFI XLS spreadsheet Tuesday a.m., and we've updated our Money Fund Wisdom database with 4/30/24 data. Our May Money Fund Portfolio Holdings are scheduled to ship on Thursday, May 9, and our May Bond Fund Intelligence is scheduled to go out on Tuesday, May 14. (Note: Register soon for our Money Fund Symposium next month in Pittsburgh, June 12-14. We hope you'll join us!)

MFI's "Prime Exit" article says, "The hits keep coming to the Prime Institutional MMF sector, as Goldman Sachs becomes the latest fund firm to announce an exit. A filing for the $1.6 billion Goldman Sachs Financial Square Money Market Fund and the $2.9 billion Goldman Sachs Financial Square Prime Obligations Fund, including its Administration, Capital, Institutional, Preferred, Select, Service, and Drexel Hamilton Class shares, explains, 'At a meeting held on April 16-17, 2024, upon the recommendation of Goldman Sachs Asset Management, the Board ... approved a proposal to liquidate the Goldman Sachs Financial Square Money Market Fund and Goldman Sachs Financial Square Prime Obligations Fund.'"

It continues, "This brings the total of Prime Institutional money funds declaring either pending conversions to Government or pending liquidations to 5 funds to date, representing $229.3 billion in assets, or 34.9% of the $657.0 billion total in Prime Inst MMFs (assets as of 3/31/24)."

We write in our Treasurers Leaning Away article, "Over the past month, a number of money fund providers (as well as Crane Data) attended and spoke at a series of regional corporate treasury events, shedding light on the recent dramatic growth of money funds and the current shifts and changes in money fund lineups. We attended TEXPO 2024, the Texas treasury event in Houston (4/14-16) and New England AFP in Boston (4/25-26), and sat through almost a dozen sessions involving money funds, liquidity and short-term investing. We quote from some of the sessions and highlights below."

It tells us, "TEXPO includes a presentation titled, 'Regulatory, Rate and Regime Changes: A Perfect Storm for Liquidity Investors?' with Jeff Jones of Twisted X, Wes Rager of Invesco, and Brittany O'Shea of Texas Capital. Rager explains, 'So, for us we’re just very defensive. We're trying to stay nimble. Typically in the rate environment that we're in, where we've seen what we think is the last rate hike, you want to start extending your portfolio. But if you extend to soon, you're locking in lower rates for a longer period of time."

Our "NY Fed" piece says, "The Federal Reserve Bank of New York's Liberty Street Economics featured the article, 'Monetary Policy and Money Market Funds in Europe.' It states, 'As shown in a past [post], the yields of money market fund (MMF) shares respond to changes in monetary policy rates much more than the rates of bank deposits; in other words, the MMF beta is much higher than the deposit beta. Consistent with this, the size of the U.S. MMF industry fluctuates over the interest rate cycle, expanding during times of monetary policy tightening. In this post, we show that the relationship between the policy rates of the European Central Bank (ECB) and the size of European MMFs investing in euro-denominated securities is also positive -- as long as policy rates are positive; after the ECB introduced negative policy rates in 2015, that relationship broke down, as MMFs received large inflows during this period.'"

It continues, "The piece explains, 'Similar to their U.S. counterparts, European MMFs can be divided into government funds ... and prime funds based on their portfolio holdings <b:>`_.... European MMFs are regulated under Regulation (EU) 2017/1131 of the European Parliament and of the Council of the European Union (EU), which was adopted in 2017 in response to the 2008 run experienced by MMFs.'"

MFI also includes the News brief, "MMF Assets Fall on Tax Payments." It states, "Money fund assets fell by $17.6 billion to $6.387 trillion in April (after falling $68.5B in March). Outflows from the long Good Friday weekend last month-end and April 15 tax payments have temporarily paused MMFs record run. Over 12 months, money funds have risen by $694.5 billion, or 12.2%, with Taxable Retail MMFs jumping $490.2 billion (26.4%) and Taxable Inst MMFs rising by $186.1 billion (5.0%)."

Another News brief, "The Wall Street Journal's CFO Journal Writes, 'Companies Belly Up to Cash Buffet, in Five Charts.' The article tells us, 'Companies are socking away cash at the fastest rate since the onset of the pandemic. Four years ago, companies boosted their cash holdings to weather economic uncertainty stemming from virus-related lockdowns. Now, with interest rates hovering at two-decade highs, they are allocating more of their portfolios to high-yielding cash ... investments, getting a welcome boost from yields that top 5% on money-market funds.'"

A third News brief, "Barron's Says, 'Money-Market Funds Look Like a Tempting Place for Your Cash.' They write, 'Most of the time, money-market mutual funds are about as exciting as watching paint dry. That's what they're designed to be: boring and reliable. But these days, money funds have gotten interesting. And tempting. Maybe overly tempting.'"

A sidebar, "Payden Limited Maturity 30," says, "A release, 'Payden & Rygel Celebrates 30 Years of the Limited Maturity Fund (PYLMX) Amidst Four Decades of Investment Excellence' states, 'Payden & Rygel is proud to announce the 30-year anniversary of its Limited Maturity Fund (PYLMX).... Payden & Rygel has cemented its reputation as a leader in short-duration strategies.... The short duration strategy team has worked together for 15 years and currently oversees $70 billion in assets.'"

Our May MFI XLS, with April 30 data, shows total assets decreased $17.6 billion to $6.387 trillion, after decreasing $66.7 billion in March, increasing $50.0 billion in February, $87.0 billion in January, $24.5 billion in December and $219.8 billion in November. Assets decreased $39.3 billion in October, but increased $77.8 billion in September, $104.2 billion in August, $21.0 billion in July, $20.3 billion in June and $152.7 billion in May."

Our broad Crane Money Fund Average 7-Day Yield was unchanged at 5.03%, and our Crane 100 Money Fund Index (the 100 largest taxable funds) was down 1 bp to 5.13% in April. On a Gross Yield Basis (7-Day) (before expenses are taken out), the Crane MFA and the Crane 100 averaged 5.40% and 5.40%, respectively. Charged Expenses averaged 0.37% and 0.26% for the Crane MFA and the Crane 100. (We'll revise expenses on Wednesday once we upload the SEC's Form N-MFP data for 4/30/24.) The average WAM (weighted average maturity) for the Crane MFA was 35 days (down 2 bps from previous month) and the Crane 100 WAM was down 3 bps at 35 days. (See our Crane Index or craneindexes.xlsx history file for more on our averages.)

Apr 05
 

The April issue of our flagship Money Fund Intelligence newsletter, which was sent out to subscribers Friday morning, features the articles: "Pending Reforms Trigger Prime Shift: Federated, Vanguard Go," which covers the budding exodus from Prime Institutional MMFs; "Bond Fund Symposium '24: Ultra-Shorts Look for Bounce," which quotes from our recent ultra-short bond fund conference; and, "Worldwide MF Assets Break $10 Trillion in '23; US Leads," which reviews ICI's latest global money fund statistics. We also sent out our MFI XLS spreadsheet Friday a.m., and we've updated our Money Fund Wisdom database with 3/31/24 data. Our April Money Fund Portfolio Holdings are scheduled to ship on Tuesday, April 9, and our April Bond Fund Intelligence is scheduled to go out on Friday, April 12.

MFI's "Prime Shift" article says, "Federated Money Market Trust is the first Prime Institutional MMF to announce its liquidation ahead of the latest round of SEC MMF Reforms. Vanguard and American Funds filed to convert two large internal money funds as well, and we'll no doubt see more moves over the next several months. The SEC's asset totals ... show Prime MMFs representing $1.4 trillion (as of 2/29/24), or 21.5%, of the $6.5 trillion in total MMFs, with Inst Public totaling $342 billion, Inst Nonpublic totaling $332 billion and Prime Retail totaling $733 billion."

It continues, “A Prospectus Supplement filing for the $1.2 billion Federated Hermes Money Market Obligations Trust, including the Inst (MMPXX), Capital (MMLXX) and Eagle Shares (MMMXX), tells us, 'On Feb. 15, 2024, the Board of Trustees of Federated Hermes Money Market Obligations Trust approved a Plan of Liquidation for the Federated Hermes Institutional Money Market Management pursuant to which the Fund will be liquidated on or about July 12, 2024.... In approving the Liquidation, the Board determined the Liquidation is in the best interests of the Fund and its shareholders. Accordingly, the Fund's investment adviser will take all action necessary to liquidate, dissolve, and wind up the affairs of the Fund.'"

We write in our Bond Fund article, "We recently hosted our latest Crane's Bond Fund Symposium in Philadelphia. Below, we quote from the 'Senior Portfolio Manager Perspectives,' which featured J.P. Morgan Asset Management's Dave Martucci, UBS A.M.'s Dave Rothweiler and PIMCO's Jerome Schneider. (Thanks again to those who supported BFS. Crane Data subscribers may access the recordings and conference materials at the bottom of our 'Content' page or via our 'Bond Fund Symposium 2024 Download Center.')"

It tells us, "Rothweiler comments, 'Looking back to 2022-2023, you had competition from the money funds with higher yields [and] stable NAVs, ... and people pushing to go longer duration. So you were getting hit from both ends.... The Street just doesn't have the balance sheet they used to have. [When] everyone runs out the door at the same time, liquidity is of the utmost importance.'"

Our "Worldwide" piece states, "The Investment Company Institute published, 'Worldwide Regulated Open-Fund Assets and Flows, Fourth Quarter 2023,' recently, which shows that money fund assets globally jumped by $497.0 billion, or 5.1%, in Q4'23 to $10.441 trillion. The increases were led by a sharp jump in money funds in U.S., while Ireland, Luxembourg, France and China also rose. Meanwhile, money funds in Argentina and Belgium were lower. MMF assets worldwide increased by $1.585 trillion, or 19.1%, in the 12 months through 12/31/23, and money funds in the U.S. now represent 56.7% of worldwide assets."

It continues, "ICI's release says, 'Worldwide regulated open-end fund assets increased 8.6% to $68.85 trillion at the end of the fourth quarter of 2023, excluding funds of funds.... [ICI] compiles worldwide regulated open-end fund statistics on behalf of the International Investment Funds Association (IIFA).... The collection for the fourth quarter of 2023 contains statistics from 45 jurisdictions.'"

MFI also includes the News brief, "MMF Assets Dip in March, Rebound to Record $6.538 Trillion on April 2." It states, "Money fund assets fell by $66.7 billion to $6.407 trillion in March, but they've soared by $140.3 billion in the first 2 days of April. Over the past 12 months, money funds have risen by $778 billion, or 13.8%, with Retail MMFs jumping $531.5 billion (29.2%) and Inst MMFs rising by $236.7 billion (6.4%)."

Another News brief, "BlackRock Launches Tokenized MF," comments, "A release entitled, 'BlackRock Launches Its First Tokenized Fund, BUIDL, on the Ethereum Network,' says, 'BlackRock unveil[ed] its first tokenized fund issued on a public blockchain, the BlackRock USD Institutional Digital Liquidity Fund (BUIDL). BUIDL will provide qualified investors with the opportunity to earn U.S. dollar yields by subscribing to the Fund through Securitize Markets, LLC.'"

A third News brief, "ICI: MMF Expense Ratios 0.22% in '23," says, "The Investment Company Institute published, 'Trends in the Expenses and Fees of Funds, 2023,' which tells us, 'Average expense ratios of hybrid and bond mutual funds, as well as money market funds, have ... declined meaningfully since 1996.' A table shows expense ratios by type from 1996 to 2023 and shows bonds fund averages falling from 0.84% to 0.37% over this period and money fund ratios falling from 0.52% to 0.22%. (Note: Crane Data shows the average expense ratio for money market mutual funds at 0.26% as of 2/29/24 as measured by our Crane 100 Money Fund Index.)"

A sidebar, "WSJ on Wall of Cash Bulls," says, "The Wall Street Journal writes, 'Sorry Stock Bulls, the 'Wall of Cash' Isn't All Headed Your Way.' They explain, 'Trillions of dollars are seemingly available to move out of cash funds and be put to work in the stock market. That possibility has had stock-market bulls salivating, but they are probably in for disappointment. Despite the expectation that the Federal Reserve's next move is to cut rates, money-market-fund assets have continued to grow at a fast pace. They are now around $6.5 trillion, according to industry tracker Crane Data. While the S&P 500 is up 8% year to date, total money funds added more than $150 billion in assets through the first two months of 2024, or about $50 billion more than they did in the same period last year, according to Crane.'"

Our April MFI XLS, with March 31 data, shows total assets decreased $66.7 billion to $6.407 trillion, after increasing $50.0 billion in February, $87.0 billion in January, $24.5 billion in December and $219.8 billion in November. Assets decreased $39.3 billion in October, but increased $77.8 billion in September, $104.2 billion in August, $21.0 billion in July, $20.3 billion in June, $152.7 billion in May and $56.5 billion in April."

Our broad Crane Money Fund Average 7-Day Yield was down 1 bp to 5.03%, and our Crane 100 Money Fund Index (the 100 largest taxable funds) was down 1 bp to 5.14% in March. On a Gross Yield Basis (7-Day) (before expenses are taken out), the Crane MFA and the Crane 100 averaged 5.40% and 5.41%, respectively. Charged Expenses averaged 0.37% and 0.26% for the Crane MFA and the Crane 100. (We'll revise expenses on Monday once we upload the SEC's Form N-MFP data for 3/31/24.) The average WAM (weighted average maturity) for the Crane MFA was 37 days (down 1 bp from previous month) and the Crane 100 WAM was down 2 bps at 38 days. (See our Crane Index or craneindexes.xlsx history file for more on our averages.)

Mar 07
 

The March issue of our flagship Money Fund Intelligence newsletter, which was sent out to subscribers Thursday morning, features the articles: "WisdomTree, XD Attempt Digital, Blockchain MMFs," which covers new money funds using blockchain technology; "FSB Reviews Global Money Fund Reforms; FHI's 10-K," which quotes from the regulatory discussion outside the U.S.; and, "Examining the Shift in Fed Repo to T-Bills, Other Repo," which reviews the dramatic shift in MMF portfolios. We also sent out our MFI XLS spreadsheet Thursday a.m., and we've updated our Money Fund Wisdom database with 2/29/24 data. Our March Money Fund Portfolio Holdings are scheduled to ship on Monday, March 11, and our March Bond Fund Intelligence is scheduled to go out on Thursday, March 14. (Note: Register ASAP for our Bond Fund Symposium, which is March 25-26 in Philadelphia. We hope to see you in Philly!)

MFI's "WisdomTree, XD" article says, "A pair of money market mutual fund attempting to use blockchain technology have launched recently. WisdomTree Government Money Market Digital Fund and XD Treasury Money Market Fund join Franklin OnChain US Govt Money Fund, which launched in 2019, in what appear to be experiments attempting to take advantage of the buzz surrounding digital assets and currencies."

"WisdomTree says on its website, "Why WTGXX? Provide investors a high level of current income consistent with the preservation of capital and liquidity and the maintenance of a stable net asset value through investments in short-term government securities. It has a 0.25% expense ratio and only a $1 minimum to invest. Shares will be secondarily recorded using on-chain recordkeeping on the Stellar or Ethereum blockchain. The Fund will not directly or indirectly invest in any assets that rely on blockchain technology, such as cryptocurrencies. The Fund uses blockchain technology to maintain a secondary record of its shares. The Fund will be available exclusively through the WisdomTree Prime financial app."

We write in our FSB Reviews article, "A press release titled, 'FSB review finds uneven implementation of money market fund reforms,' tells us, 'The Financial Stability Board (FSB) ... published its 'Thematic Review on Money Market Fund (MMF) Reforms.' The review takes stock of the measures adopted or planned by FSB member jurisdictions in response to the 2021 FSB report, Policy Proposals to Enhance MMF Resilience. The review does not assess the effectiveness of those policy measures in addressing risks to financial stability, as this will be the focus of separate follow-up work by the FSB in 2026.'"

It tells us, "Their release claims, 'The main MMF vulnerability identified by jurisdictions is the mismatch between the liquidity of fund asset holdings and the redemption terms offered to investors, which makes MMFs susceptible to runs from sudden and disruptive redemptions. To address vulnerabilities, the 2021 FSB report provided a menu of policy options including: imposing on redeeming investors the cost of their redemptions; enhancing the ability to absorb credit losses; addressing regulatory thresholds that may give rise to cliff effects; and reducing liquidity transformation.'"

Our "Examining the Shift" piece states, "Looking back over the past 12 months, the shift in money market fund holdings from Fed repo into T-bills has been massive. On Jan. 31, 2023, taxable money funds held $1.974 trillion in repo with the Fed, which rose to over $2.211 trillion in March 2023, but has since declined to $582.6 billion on 1/31/24. Treasury holdings rose from $1.051 trillion a year earlier to $2.357 trillion over this time."

It continues, "The Wall Street Journal writes that, 'Treasury Markets Are Losing Their Shock Absorber.' They explain, 'Participation is dwindling in a Federal Reserve program that has helped the U. S. government limit its borrowing costs, a development that many investors say presages higher interest rates and larger swings in the $26 trillion Treasury market. The overnight reverse repurchase facility, known on Wall Street as reverse repo, enables large financial firms such as money-market funds to briefly swap extra cash for high-quality securities on the central bank's balance sheet and pocket some interest. The Fed program has been used heavily in recent years, at one point hitting $2.5 trillion of daily balances, but that number has shrunk steadily and recently fell below $500 billion.'"

MFI also includes the News brief, "MMF Assets Hit Record $6.459 Tril." It states, "Money market mutual fund assets rose another $50.0 billion in February to a record $​6.​471 trillion. Over the past 12 months, money funds have risen a massive $​1.203 trillion, or 22.​8%, with Retail MMFs rising by $​568.2 billion (32.5%) and Inst MMFs rising by $​628.5 billion (18.58%). ICI's separate (and smaller) weekly series shows assets rising $49.9 billion last week to a record $6.059 trillion."

Another News brief, "JPM Looks at Corporate Cash, MMFs," quotes J.P. Morgan's latest 'Short- Term Market Outlook and Strategy,' which features a brief titled, 'Corporates are keeping more cash in their portfolios.' It says, "JPM's update shows the cash investment portfolios of the `5 largest tech companies -- AAPL, META, AMZN, MSFT and GOOG -- with $80.6 billion in money market funds."

A third News brief, "Feb. Portfolio Holdings: Plunge in Repo, Jump in Treasury. Our latest Money Fund Portfolio Holdings statistics show that Repo holdings plummeted while Treasuries, Time Deposits and Agencies jumped. Repo continued its steep slide, dropping $163.2 billion, after a brief rebound the month prior; it remains the largest portfolio segment. Treasuries increased by $104.7 billion, still ranking in the No. 2 spot, but barely. Agencies were the third largest segment, CP remained fourth, ahead of CDs, Other/Time Deposits and VRDNs."

A sidebar, "Bloomberg on Wall of Cash," says, "Bloomberg writes, '`A $6 Trillion Wall of Cash Is Holding Firm as Fed Delays Cuts.' It says, 'Investors are plowing billions into money-market funds by the day .... For an asset class that many market prognosticators all but left for dead to start the year, there’s still plenty of life left in cash. Investors have added $128 billion to US money-market funds since the start of the year, ICI data show.... It's a stark contrast to just a couple of months ago, when one of the hottest questions on Wall Street was where investors would redeploy all their cash holdings once the Federal Reserve started cutting rates.'"

Our March MFI XLS, with February 29 data, shows total assets increased $50.0 billion to a record $6.459 trillion, after increasing $87.0 billion in January, $24.5 billion in December and $219.8 billion in November. Assets decreased $39.3 billion in October, but increased $77.8 billion in September, $104.2 billion in August, $21.0 billion in July, $20.3 billion in June, $152.7 billion in May, $56.5 billion in April and $345.1 billion in March."

Our broad Crane Money Fund Average 7-Day Yield was down 2 bps to 5.04%, and our Crane 100 Money Fund Index (the 100 largest taxable funds) was down 2 bps to 5.15% in February. On a Gross Yield Basis (7-Day) (before expenses are taken out), the Crane MFA and the Crane 100 both averaged 5.41%. Charged Expenses averaged 0.37% and 0.26% for the Crane MFA and the Crane 100. (We'll revise expenses on Friday once we upload the SEC's Form N-MFP data for 2/29/24.) The average WAM (weighted average maturity) for the Crane MFA was 38 days (unchanged from previous month) and the Crane 100 WAM was up 1 bp at 39 days. (See our Crane Index or craneindexes.xlsx history file for more on our averages.)