Money fund assets jumped for the second straight month in September, rising by $28.0 billion after a jump of $34.0 billion in August. Since the SEC passed its latest Money Fund Reforms in July, assets have increased by $55.4 billion. Crane's Money Fund Intelligence Daily shows that month-to-date through September 29, total money fund assets have increased by $28.0 billion (assets dropped $2.1 billion yesterday, a much smaller than normal drop for quarter-end), while ICI's latest "Trends in Mutual Fund Investing, August 2014" shows that total money fund assets increased by $34.0 billion in August to $2.581 trillion. (ICI's monthly statistics show that MMF assets decreased by $16.1 billion in July, dropped $17 billion in June, and increased $3.8 billion in May.) For the 12 months through 8/31/14, ICI's monthly series shows money fund assets down by $49.7 billion, or 1.5%. Below, we review recent asset flows, ICI's latest Trends report, and ICI's monthly Portfolio Composition figures.
Our MFI Daily shows that Prime Institutional assets, which should be the most impacted by the SEC's recent reforms, have increased by $5.3 billion month-to-date through Sept. 29 to $813.5 billion. Prime Institutional assets have increased by $15.4 billion since July 23, belying predictions of outflows accompanying the new rules. Treasury Institutional money funds have shown the largest increases though, gaining $20.2 billion in Sept. MTD and $26.5 billion since July 23. (Note that the latest issue of our Money Fund Intelligence newsletter showed monthly asset changes for September averaging a decline of $22 billion over the past 5 years, but an increase of $18 billion on average in 2012-2013.)
ICI's August "Trends" says, "The combined assets of the nation's mutual funds decreased by $384.3 billion, or 2.7 percent, to $15.84 trillion in August, according to the Investment Company Institute's official survey of the mutual fund industry. In the survey, mutual fund companies report actual assets, sales, and redemptions to ICI. Bond funds had an outflow of $4.41 billion in August, compared with an inflow of $9.45 billion in July. Taxable bond funds had an inflow of $1.15 billion in August, versus an inflow of $8.01 billion in July. Municipal bond funds had an inflow of $3.26 billion in August, compared with an inflow of $1.44 billion in July."
It adds, "Money market funds had an inflow of $36.04 billion in August, compared with an outflow of $16.06 billion in July. In August funds offered primarily to institutions had an inflow of $29.08 billion and funds offered primarily to individuals had an inflow of $6.96 billion." Money funds represent 16.3% of all mutual fund assets while bond funds represent 22.0%.
ICI also released its latest "Month-End Portfolio Holdings of Taxable Money Funds," which showed slight increases in CDs and Cash Reserves. (See Crane Data's September 11 "News", "Sept. MF Holdings Show Jump in Time Deposits, Fed Repo; CDs Flat.") ICI's latest Portfolio Holdings summary shows that Holdings of Certificates of Deposits increased by $11.5 billion, or 2%, in August (after increasing $59.9 billion in July, decreasing $60.7 billion in June, and increasing 9.9 billion in May) to $582.4 billion (or 25.0% of taxable MMF holdings). CDs remained the largest segment of taxable money fund portfolio holdings in August, according to ICI's data series.
Repos jumped by $7.2 billion, or 1.4%, (after rising by $71.9 billion in July, $63.9 billion in June, and $33.5 billion in May) to $510.3 billion (21.9% of assets). Repos are the second largest composition segment. Commercial Paper, which increased by $2.9 billion, or 0.8%, inched up to the third largest segment, moving ahead of Treasury Bills & Securities. CP holdings totaled $357.0 billion (15.4% of assets). `Treasury Bills & Securities, the fourth largest segment, dropped $3.0 billion (after dropping $16.7 billion in July, plunging $3.6 billion in June, and dipping $29.7 billion in May) to $355.5 billion. They represent 15.3% of assets.
U.S. Government Agency Securities are the fifth largest segment. Agencies grew by $1.2 billion or 1% in August to $350.5 billion (15.1% of assets). Notes (including Corporate and Bank) grew by $2.1 billion to $69.9 billion (3.0% of assets), and Other holdings increased by $900 million to $47.1 billion (2.0% of assets).
The Number of Accounts Outstanding in ICI's Holdings series for taxable money funds decreased by 195.0 thousand to 23.445 million, while the Number of Funds decreased by 2 to 371. Over the past 12 months, the number of accounts fell by 201.2 thousand and the number of funds declined by 18. The Average Maturity of Portfolios remained the same at 45 days in August. Over the past 12 months, WAMs of Taxable money funds declined by 4 days.
The latest numbers from our Money Fund Intelligence Daily show that total money fund assets are $2.51 trillion through September 29, up $28.0 billion month-to-date and down $104.7 billion (4.0%) year-to-date (through September 29). The Crane Money Fund Average, which tracks all taxable funds, has jumped $30.3 billion month-to-date to $2.26 trillion through September 29. Year-to-date, the Crane Money Fund Average is down $88.7 billion; over the last 7 days it's up $25.9 billion. The Crane Retail Money Fund Index has increased $1.1 billion MTD to $767.8 billion but is down $27.1 billion YTD through September 29. The Crane Institutional Money Fund Index is up $29.2 billion to $1.49 trillion MTD and down $61.7 billion YTD.
Note: Crane Data updated its September MFI XLS to reflect the 8/31/14 composition data and maturity breakouts for our entire fund universe. Note again too that we are now producing a "Holdings Reports Issuer Module," which allows subscribers to choose a series of Portfolio Holdings and Issuers and to see a full listing of which money funds own this paper. (Visit our Content Center and the latest Money Fund Portfolio Holdings download page to access the latest version of this new file.)
