MFI Distribution Survey

MFI Distribution Survey Sample Wells Fargo Securities' Garret Sloan and Vanessa Hubbard write in their latest "Daily Short Stuff," "Last week we commented on the significant week-over-week jump in the SIFMA index.... This week there has been another dramatic increase as the index reset 31 basis points higher yesterday, beating last week's move as the largest weekly climb since the end of 2008. All of the reasons we gave last week for the recent rise are still relevant, most notably end of year supply and liquidity dynamics. In the month of December, the weekly SIFMA index has gained 71 basis points over four short weeks. To put this move into perspective, from January 2017 to the first week in December, the index has climbed just 32 basis points. This 32 basis point move over 49 weeks withstood three Fed fund rate hikes of 25 basis points each. Year-end liquidity constraints are exasperating the upward trajectory in the weekly SIFMA index." They add, "Similarly, but not as dramatic, commercial paper rates have risen quickly over the past few weeks as well mostly attributed to end of year liquidity dynamics. The 5-day moving average for 30 day Tier-1 nonfinancial CP according to Fed data has risen by about 27 basis points in the month of December and the index for Tier-1 financial CP has risen by 24 basis points. Tier-2 CP rates have climbed in aggregate an average of 35 basis points over this same timeframe. Supply has also increased over this period with commercial paper outstanding on a seasonally adjusted basis growing from $1.05 trillion at the beginning of December to $1.08 trillion last week."

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MFI Distribution Survey News

Jan 06

While we were holding out and hoping to have a live event, concerns over the virus spike have forced us to cancel our upcoming live Money Fund University and shift to a virtual event. Our 12th annual MFU "basic training" conference will still take place in two weeks, January 20-21, 2022, but it'll be during the afternoons only and no longer at the Boston Hyatt. Crane's Money Fund University is designed for those new to the money market fund industry or those in need of a concentrated refresher on the basics. The event also focuses on hot topics like money market fund regulations, money fund alternatives, offshore markets, and other recent industry trends. Registrations (now $250 instead of the $500 we charge for the live event) are still being taken, and the latest agenda is available here. (E-mail us to request the latest brochure.)

Money Fund University offers a 2-day crash course on money market mutual funds, educating attendees on the history of money funds, the Fed, interest rates, ratings, rankings, and money market instruments such as commercial paper, Treasury bills, CDs and repo. We also cover portfolio construction and credit analysis. Our educational conference features a faculty of the money fund industry's top lawyers, strategists, and portfolio managers.

New portfolio managers, analysts, investors, issuers, service providers, and anyone interested in expanding their knowledge of "cash" investing should benefit from our comprehensive program. Even experienced professionals may enjoy a refresher course and the opportunity to interact with peers in an informal setting. Attendee registration for Crane's Money Fund University is just $250, and sponsorship opportunities are $2K (Bronze), $3K (Silver) and $5K (Gold).

We'd like to thank our current and past MFU sponsors -- BlackRock, Dreyfus CIS, J.P. Morgan Asset Management, Fitch Ratings, TD Securities, S&P Global Ratings, Dechert LLP, Fidelity Investments and Federated Hermes -- for their support, and we look forward to seeing you online in 2 weeks. E-mail Pete Crane ( for the latest brochure or visit to register or for more details.

Crane Data is also preparing for our next Bond Fund Symposium, which will be held March 28-29, 2022, at the Hyatt Regency in Newport Beach, Calif. Our Bond Fund Symposium offers a concentrated and affordable educational experience, as well as an excellent and informal networking venue. Registration for Bond Fund Symposium is $750; exhibit space is $2,000 (includes 2 tickets); and sponsorship opportunities are $3K, $4K, $5K, and $6K. Our mission is to deliver the best possible conference content at a reasonable price to bond fund professionals and investors.

We're also beginning to make plans for our next "big show," Money Fund Symposium, which will be held June 20-22, 2022, at the Hyatt Regency in Minneapolis. (Let us know if you'd like details on speaking or sponsoring.) Finally, mark your calendars for our next European Money Fund Symposium, which will be held Sept. 27-28, 2022, in Paris, France. Watch for more details on these shows in coming weeks and months. Note that the recordings and materials from our past events are available to Crane Data subscribers at the bottom of our "Content" page. Let us know if you'd like more info on any of our (or other "cash") events, and we hope to see you in Newport Beach in March, Minneapolis in June or Paris in September in 2022!

In other news, Wells Fargo Corporate & Investment Banking's Vanessa McMichael, who will present on "CDs, TDs & Bank Debt" at our upcoming Money Fund University, recently published a "2021: A year in review." She comments, "The Fed's Reverse Repo Facility (RRP) was a focal point in 2021 with new highs reached over and over. On the final day of 2021, the facility accepted $1.9 trillion with 103 counterparties.... Last year marked another explosive one for government MMF assets while prime MMFs experienced marginal outflows. The growth in government MMFs is reflective of the environment in which cash is abundant, while the decline in prime funds mid-2021 and beyond, seemed to be driven by the rate environment more than anything else. With prime fund yields hovering just above zero, the value for investment dwindled for some investors. Likewise, tax-exempt MMFs also shed assets this year which could be driven by similar factors."

The Wells Strategist also writes, "Front-end government supply declined in 2021; thus, the RRP was a critical instrument for government MMFs during this period of growth. According to Crane Data, the latest month-end MMF portfolio holdings indicate that 45% of total taxable MMF holdings are repo. During the same timeframe in 2019, repo made up about 30% of taxable MMF holdings."

She states, "Prime MMFs were blamed for short term market interference at the start of the pandemic. While prime funds did experience significant outflows in March 2020, the flight-to-quality was widespread and not entirely the fault of this one particular asset class. Nonetheless, in December 2020, the President's Working Group released a study of potential policy measures to address risks that prime funds and tax-exempt funds face in times of short-term market stress. The paper was debated amongst money market participants for most of 2021. On December 15th, 2021, the SEC released proposed changes to money market fund reform. The proposal was released with three members in favor and two dissenting. The changes are not yet final as there is a public comment period open for 60 days after the release."

McMichael says, "In summary, here are the reforms that are attempting to reduce the speed of excessive redemptions when market conditions shift: Increase minimum liquidity requirements; Remove the ability of money market funds to impose liquidity fees and redemption gates when they fall below certain liquidity thresholds; Require certain money market funds to implement swing pricing; and, Enhance certain reporting requirements."

Finally, she adds, "ESG became a larger conversation with money market investors given the growth in ESG and D&I MMFs. In the 2a-7 space, ESG/D&I funds operate like government or prime funds and purchase securities similar to other 2a-7 funds but transact with broker-dealers that are women-owned or black-owned, as examples. Similarly, these funds might allocate a portion of their management fee to an ESG/D&I cause or refuse to purchase individual securities from non-ESG friendly industries/issuers."

Dec 23

As we enter the Holiday season, Crane Data is ramping up preparations for its 2022 conference calendar. We'll be doing events in January (Money Fund University on Jan. 20-21) and in March (Bond Fund Symposium, March 28-29). Crane's Money Fund Symposium, the largest gathering of money market fund managers and cash investors in the world, will take place June 20-22, 2022 at The Hyatt Regency Minneapolis, in Minneapolis, Minn. The preliminary agenda is now available and registrations are now being taken. Money Fund Symposium attracts money fund managers, marketers and servicers, cash investors, money market securities dealers, issuers, and regulators. We review our preliminary agenda, as well as Crane Data's other 2022 conferences, below. (Note: We apologies for our website being down Wednesday morning, 12/22! We were impacted by the Amazon AWS outage.... We're repeating our News and LOTD from Wed., since it wasn't included in our MFI Daily. Sorry for the inconvenience, and Happy Holidays!)

Our MF Symposium Agenda kicks off on Wednesday, June 20 with a "Keynote: The Brave New World in Liquidity" featuring Joe Sullivan and Yeng Felipe Butler of Allspring Global Investments (formerly Wells Fargo Funds). The rest of the Day 1 Agenda includes: "Strategists Speak '22: Fed, Rates & Reforms," with Vanessa Hubbard McMichael of Wells Fargo Securities, Priya Misra of TD Securities and Alex Roever of J.P. Morgan Securities; a "Corporate Investor, Portal & ESG MF Discussion" with Tom Hunt of AFP, Tom Callahan of BlackRock and Tory Hazard of Institutional Cash Distributors; and, a "Major Money Fund Issues 2022" panel with moderator Peter Crane of Crane Data, Deborah Cunningham of Federated Hermes, John Tobin of BNY Mellon Cash Investment Strategies and Peter Yi of Northern Trust AM. (The evening's reception is sponsored by Bank of America.)

Day 2 of Money Fund Symposium 2022 begins with "Treasury Issuance & Fed Repo Update," which features Mark Cabana of BofA Securities, Dina Marchioni of the Federal Reserve Bank of NY and Tom Katzenbach of the U.S. Dept. of the Treasury ; followed by a "Senior Portfolio Manager Perspectives" panel with Linda Klingman of Charles Schwab I.M., Nafis Smith of Vanguard and Jeff Plotnik of U.S. Bancorp Asset Mgmt. Next up is "Government Money Fund & Repo Issues," with Joseph Abate of Barclays, Mike Bird of Allspring Funds and Geoff Gibbs of DWS. The morning concludes with a "Muni & Tax Exempt Money Fund Update," featuring Colleen Meehan of Dreyfus, John Vetter of Fidelity and Sean Saroya of J.P. Morgan Securities.

The Afternoon of Day 2 (after a Dreyfus-sponsored lunch) features the segments: "Dealer's Choice: Supply, New Securities & CP" with Robe Crowe of Citi Global Markets, John Kodweis of J.P. Morgan and Stewart Cutler of Barclays; "Ratings Focus: Governance, Global & LGIPs" with Robert Callagy of Moody's Investors Service, Greg Fayvilevich of Fitch Ratings, and Michael Masih of S&P Global Ratings; "Ultra-Short Bond & European MMF Update," with Rob Sabatino of UBS Asset Mgmt. and Laurie Brignac of Invesco. The day's wrap-up presentation is "Brokerage Sweeps, Deposits & AMAs" involving Chris Melin of Ameriprise Financial. (The Day 2 reception is sponsored by Barclays.)

The third day of the Symposium features the sessions: "The State of the Money Fund Industry" with Peter Crane of Crane Data and Michael Morin of Fidelity Investments; "MMF Reforms & Regulatory Review," with Brenden Carroll of Dechert LLP; and, a session on "Money Fund Statistics, Software & Disclosures.

Visit the MF Symposium website at for more details. Registration is $750, and discounted hotel reservations are available. We hope you'll join us in Minneapolis this June! We'll of course continue watching the latest on the coronavirus, but we expect normal travel to resume once this latest wave of moderate cases retreats. Note that some of our speakers have yet to confirm their participation, and the agenda is still in the process of being finalized, so watch for tweaks in coming weeks. E-mail us at to request the full brochure.)

We're also making final preparations for Crane's Money Fund University, which will be in Boston, Mass., January 20-21, 2022. Our Money Fund University will cover the history of money funds, interest rates, regulations (Rule 2a-7), ratings, rankings, money market instruments such as commercial paper, CDs and repo, and portfolio construction and credit analysis. We also include segments on offshore money funds and ultra-short bond funds. (We continue to plan for a live event, but might switch to a virtual event at the last minute if necessary.)

Money Fund University's comprehensive program is good for both beginners and experienced professionals looking for a refresher. The latest agenda is available online and we are still accepting registrations ($500). (We're also willing to "comp" tickets for large Crane Data or sponsor clients, so let us know if you're interested.)

We're also getting ready for our next Crane's Bond Fund Symposium, which will be held in Newport Beach, Calif., March 28-29. (Click here to see the agenda.) Bond Fund Symposium is the only conference devoted entirely to bond mutual funds, bringing together bond fund managers, marketers, and professionals with fixed-income issuers, investors and service providers. The majority of the content is aimed at the growing ultra-short and conservative ultra-short bond fund marketplace.

Crane Data, which recently celebrated the 7th anniversary of our Bond Fund Intelligence publication and BFI XLS bond fund information service and benchmarks, continues to expand its fixed income fund offerings with the recent launch of Bond Fund Wisdom product and Bond Fund Portfolio Holdings dataset. Bond Fund Symposium offers attendees a concentrated and affordable educational experience, as well as an excellent networking venue. Registration for Bond Fund Symposium is $750. Our mission is to deliver the best possible conference content at an affordable price to bond fund professionals and investors.

Finally, we're also set the dates and location for our next European Money Fund Symposium. It is scheduled for Sept. 27-28, 2022, in Paris, France. Let us know if you'd like more details on any of our events, and we hope to see you in Boston next month, in Newport Beach in March, in Minneapolis in June and/or Paris later in 2021. Thanks for your patience and support in 2021, Happy Holidays and Happy New Year!

Dec 07

The December issue of our flagship Money Fund Intelligence newsletter, which was sent to subscribers Tuesday morning, features the articles: "Outlook for 2022 Brightens; JPM on Hikes, MM Supply," which discusses whether money funds might have a Happy New Year; "SSGA Debuts Opportunity; Bancroft, Cabrera Shares," which reviews yet more D&I share classes; and, "OFR Annual Report: Money Funds, Repo Among Risks," which examines the latest concerns of regulators over money funds. We also sent out our MFI XLS spreadsheet Thursday morning, and we've updated our database query system with 11/30/21 data. (Note: Money Fund Wisdom is down temporarily but should be back up next month. MFI, MFI XLS and our Crane Index products are all available to subscribers via our Content center.) Our December Money Fund Portfolio Holdings are scheduled to ship on Thursday, Dec. 9, and our December Bond Fund Intelligence is scheduled to go out on Tuesday, Dec. 14.

MFI's lead article says, "As the odds of higher short-term rates rise, the outlook for money market funds has brightened. Though pending money fund reforms and turmoil brought on by the rate shift pose risks, the prospect of fee waiver relief and asset inflows from banks and bond markets should make 2022 a very good year for cash."

We quote J.P. Morgan Securities' "Short-Term Fixed Income 2022 Outlook," which contains a piece entitled, "The same, only different." They tell us, "In 2022, the prospect of Fed rate hikes should meaningfully boost yields away from the zero bound, allowing money funds to recapture some fee waivers.... Even so, the amount of excess liquidity in the money markets, and the broader financial markets, will remain substantial. At the same time, overall money market supply will remain anemic as Treasury is unlikely going to revitalize its net T-bill issuance. Much like this year, the supply-demand mismatch will continue to pose challenges for participants in money markets. Usage at the Fed RRP is unlikely going to see much relief any time soon."

Our second article reads, "Money market fund managers continue to launch 'D&I' share classes, the latest trend in the ESG & Social money fund space. The most recent moves come from SSGA, which announced new 'Opportunity' share classes, and BlackRock, which went live with its new Bancroft and Cabrera classes. A press release, entitled, 'State Street Global Advisors Introduces I&D Focused Share Class within Cash Management Suite,' tells us, 'State Street Global Advisors, the asset management business of State Street Corporation (STT), announced the launch of a new money market fund share class, the Opportunity Class, which will benefit philanthropic organizations whose values align with State Street's commitment to racial equity and social justice. With the launch of the new Opportunity Class shares within State Street Global Advisors' existing money market fund suite, the firm is answering the call from clients who are increasingly interested in supporting I&D initiatives with their strategic cash investments."

We quote Kim Hochfeld, SSGA's Global Head of Cash, "As one of the world's largest fiduciary managers who is deeply committed to ESG-focused asset stewardship, we see it as our responsibility to offer our clients an opportunity to have a positive impact within their cash investment strategy.... Our clients are more interested than ever in a holistic, action-oriented approach to inclusion and diversity initiatives."

Our "OFR" excerpt explains, "The Treasury's Office of Financial Research published, 'OFR 2021 Annual Report to Congress,' which analyzes threats to financial stability and contains several quotes relating to money market funds. Under 'Assessing Risks Inside the Markets,' OFR writes, 'With respect to the financial markets themselves, vulnerabilities pose potential liquidity risks. While liquidity risks were contained this year ..., the OFR continues to study the uncertainty surrounding the impact of future investor runs in short-term funding markets. Sudden pressure on money market funds and other alternative cash vehicles to raise large amounts of cash strained liquidity in these markets in 2020 and prompted intervention by the Federal Reserve. As regulators explore reform options, there is a continuing need to monitor the interconnectedness of these markets and their participants."

They tell us, "To increase the transparency of financial data, the OFR in 2021 updated its U.S. Money Market Fund (MMF) Monitor to show both the principal amount of repurchase agreement (repo) transactions and the collateral pledged against these loans. The Short-term Funding Monitor was also upgraded to shed more light on the repo markets and to include a new collateral product that the Fixed Income Clearing Corporation (FICC) rolled out in September."

MFI also includes the News brief, "Assets Finishing Year Strong, Again. ICI's latest weekly 'Money Market Fund Assets' report shows assets rising for the fourth week in a row and the fifth week out of the past six. Assets are up $103.4 billion over 6 weeks, to $4.62 trillion, and they are up $324 billion, or 7.5%, YTD in 2021. Crane Data's MFI XLS shows assets rising $49.7 billion in November to $5.055 trillion."

Another News brief, "Meeder Liquidating Prime MF," says, "An SEC filing for Meeder Prime Money Market Fund tells us, 'The Board ... has determined that it is in the best interests of shareholders to liquidate the Prime Money Market Fund ... expected to take place on or about Dec. 28."

Our December MFI XLS, with Nov. 30 data, shows total assets increased $49.7 billion to $5.055 trillion, after increasing $20.5 billion October, decreasing $878 million in September and increasing $27.9 billion in August. Assets decreased $12.4 billion in July and $73.0 billion in June. Our broad Crane Money Fund Average 7-Day Yield was flat at 0.02%, and our Crane 100 Money Fund Index (the 100 largest taxable funds) also remained flat at 0.02%.

On a Gross Yield Basis (7-Day) (before expenses are taken out), the Crane MFA and the Crane 100 both inched higher to 0.09%. Charged Expenses averaged 0.07% for the Crane MFA and the Crane 100. (We'll revise expenses Wednesday once we upload the SEC's Form N-MFP data for 11/30.) The average WAM (weighted average maturity) for the Crane MFA was 37 days (unchanged) while the Crane 100 WAM rose one day to 39 days). (See our Crane Index or craneindexes.xlsx history file for more on our averages.)

Nov 15

The November issue of our Bond Fund Intelligence, which was sent to subscribers Monday morning, features the lead story, "SSGA on The Rise of ESG in Fixed Income; ETFs Gaining," which reviews a new State Street survey on social trends in bond funds; and "TCW's Steve Kane on MetWest ESG Securitized," which interviews the TCW portfolio manager and looks at their latest offerings. BFI also recaps the latest Bond Fund News and includes our Crane BFI Indexes, which show that bond fund returns fell again in October and yields inched higher. We excerpt from the new issue below. (Contact us if you'd like to see our latest Bond Fund Intelligence and BFI XLS spreadsheet, or our Bond Fund Portfolio Holdings data.)

BFI's "SSGA ESG" piece reads, "State Street Global Advisors published, 'The Rise of ESG Fixed Income,' which reviews recent trends in environmental, social and governance impacting bond funds and ETFs. They write, 'According to our recent survey of more than 350 global institutional investors, 61% are prioritizing the integration of ESG factors in their fixed income portfolios over the next three yearsThis validates the strong trend of asset growth in the evolving fixed income ESG universe now comprised of nearly 1,000 funds globally with total assets of $450 billion under management, with $41 billion in North America and $404 billion in Europe.'"

SSGA's piece continues, "Although most of these assets have been invested in active mutual funds, there has been a meaningful uptick in both the number of ESG fixed income exchange traded funds (ETFs) and their adoption by investors. In 2020, ESG fixed income ETFs had inflows of $12.9 billion, more than three times the previous record year. Inflows the first eight months of 2021 have already surpassed that figure. More than half (58%) of all respondents in our survey noted that they will most likely use ETFs as their preferred investment vehicle for increasing allocations to fixed income ESG strategies, with investors in North America (68%) having a stronger preference for ESG-related ETFs than those in Europe (50%)."

The TCW "profile" states, "This month, BFI interviews Steve Kane, co-CIO and generalist portfolio manager at TCW Investment Management. We discuss the new ESG Securitized Bond Fund, TCW and MetWest's broader bond fund lineup, and the manager's latest observations. Our Q&A follows."

BFI says, "Give us a little history." Kane explains, "The fixed income team here at TCW, the core of it at least, originally came from Metropolitan West Asset Management. MetWest was founded by me and a few other PMs, including Tad Rivelle and Laird Landmann.... The three of us began our careers together at PIMCO back in the early 1990s.... MetWest focused initially on core, core plus and traditional multi-sector fixed-income strategies. We then built our team and came over to TCW through an acquisition in 2009. Since that point, we've been heading up the TCW fixed income team."

Kane continues, "TCW maintains mutual funds under the TCW and MetWest names, but for fixed income it's been the same team from 2009 forward. We've grown the assets to about $240 billion, and we have a team of 75 investment professionals. We have 4 generalist portfolio managers overseeing the investing activity and focusing on macro elements of strategy across portfolios -- duration and yield curve and broad sector exposure. Then the balance of the team, 71 people, are divided into sector teams.... There are the traditional fixed-income sectors: corporate credit, securitized credit, government and the rates team, and emerging markets."

Our News brief, "Returns Fall Again, Yields Rise in Oct.," states, "Bond fund returns dropped and yields inched higher last month. Our BFI Total Index fell 0.15% for 1-month but rose 2.79% for 12 months. The BFI 100 returned -0.10% in Oct. and 2.74% over 1-year. Our BFI Conservative Ultra-Short Index was down 0.06% for 1-mo and 0.21% for 1-yr; Ultra-Shorts declined 0.10% and rose 0.84%, respectively. Short-Term decreased 0.32% but rose 1.63%, and Intm-Term fell 0.16% in Oct. but rose 1.58% over 1-year. BFI's Long-Term Index rose 0.14% in Oct. and gained 1.95% over 1-year. Our High Yield Index fell 0.12% in Oct. but gained 9.16% over 1-year."

Another News brief, entitled, "Morningstar Says 'Short-Term Bond Fund Investors Get Active,'" explains, "The short-term bond Morningstar Category has seen increased inflows in the past couple of years -- and in September, it took in more money than any other category. That makes sense given investor worries about future interest rate increases. Perhaps more surprising is that a lot of this money has gone to actively managed funds, reversing a previous trend where short-term bond fund investors favored cheaper passive vehicles."

A third News brief, "PGIM Investments Launches ESG Multisector Fixed Income Fund," quotes a statement from the company, "PGIM Investments is expanding its commitment to environmental, social and governance (ESG) investing with the launch of the PGIM ESG Total Return Bond Fund, its first dedicated ESG strategy offered to U.S. investors. The new fund is an alternative but complementary offering to PGIM's $60 billion PGIM Total Return Bond Fund."

A BFI sidebar "JPM Launches Income ETF," quotes the release, "J.P. Morgan Asset Management Launches Active Fixed Income ETF: JPMorgan Income ETF (JPIE)." They explains, "J.P. Morgan Asset Management announced the launch of JPMorgan Income ETF (JPIE), an active fixed income ETF which targets debt securities across the fixed income universe, seeking to deliver yield with lower volatility and attractive distributions. Using sector allocation shifts, JPIE invests in a wide variety of debt securities that have the potential to maximize income while reducing portfolio-level risk. JPIE draws upon the combined expertise of the firm's Global Fixed Income Currency and Commodities (GFICC) platform, providing the best ideas from diverse asset class expertise and broad investment capabilities."

Finally, a sidebar entitled, "Bond Fund Assets Fall Again," tells readers, "Bond fund inflows slowed and overall assets fell in October, though inflows rebounded the first week of November. ICI's 'Combined Estimated Long-Term Fund Flows and ETF Net Issuance,' says, 'Bond funds had estimated inflows of $12.18 billion for the week, compared to estimated inflows of $7.21 billion during the previous week. Taxable bond funds saw estimated inflows of $10.69 billion, and municipal bond funds had estimated inflows of $1.49 billion.' Over the past 5 weeks, bond funds and bond ETFs have seen inflows of $35.1 billion."