With U.S. regulators taking a closer look at money market funds, fund managers are trying to take preemptive steps to thwart regulatory actions. Still, observers doubt it is enough and some investors are contemplating short-duration bond exchange traded funds as an alternative.
Wells Fargo Advantage Funds is the latest to start posting daily disclosures of its money market fund net asset values in hopes of alleviating concerns over transparency and fund risks, writs Joe Morris for Ignites. [Short-Duration Bond ETFs: Fed Presidents Back Money Fund Reform]
“The market-based NAV, by marking holdings to current market prices, provides investors with an understanding of the value of a fund’s investments if it were completely liquidated at current market prices,” according to Wells Fargo Statement. “We expect that publishing market-based NAVs will give investors even more confidence in our commitment to maintaining a stable NAV.”
Other fund managers that have implemented daily disclosures include Federated Investors, Fidelity, J.P Morgan Asset Management, BlackRock, Bank of American Funds, Dreyfus, First American, Goldman Sachs, Invesco, Reich & Tang, Charles Schwab, State Street Global Advisors and Western Asset Management.
The daily disclosures to NAV holdings are seen as a way for fund managers to appease regulators calling for floating the NAV in light of the run on the funds during the 2008 financial crisis. [Short-Duration Bond ETFs Eye Money Fund Reform]