“This realization has opened a window of opportunity for variable NAV products with risk profiles similar to money market funds, but significantly lower expense ratios and higher investment yields,” the report noted.
“The main issue here is that many investors in money market funds think they are risk free, but every fund has a risk and return profile. Given the returns [in money market funds], is it appropriate given the risks you’re taking?” Jerome Schneider, executive VP and portfolio manager of MINT, said in the article. “Ultimately the judge and jury in this case will be individuals and institutions, which will have to determine for themselves what the appropriate risk, return and liquidity needs are.”
PIMCO Enhanced Short Maturity Strategy Fund ETF
For more information on the money markets, visit our money markets category.
Max Chen contributed to this article.