The July issue of our flagship Money Fund Intelligence newsletter, which was sent out to subscribers Monday morning, features the articles: "Money Funds Gain vs Deposits Again: AFP Liquidity Survey," which reviews corporate investors shift from banks to MMFs; "Liquidity Flowing at 11th Money Fund Symposium," which reviews coverage of our recent big show; and, "Worldwide MMFs Break $6.1T: China, U.S. Lead Gains," which discusses the latest numbers on money funds outside the U.S. We've also updated our Money Fund Wisdom database with June 30 statistics, and sent out our MFI XLS spreadsheet Monday a.m. (MFI, MFI XLS and our Crane Index products are all available to subscribers via our Content center.) Our July Money Fund Portfolio Holdings are scheduled to ship on Wednesday, July 10, and our July Bond Fund Intelligence is scheduled to go out Monday, July 15.
MFI's "MMFs vs Deposits," article says, "The Association for Financial Professionals released its '2019 AFP Liquidity Survey' recently, which shows that money market funds continue to regain market share from bank deposits among corporate investors. It tells us, 'The greatest share of allocations continues to be in bank products (46 percent) followed by Government money market funds (at 14 percent) and Treasury bills (six percent).'"
It continues, "AFP says, 'The share of funds allocated to Prime Funds has increased, almost equaling the share in T-bills. Bank relationships continue to be core to a company's operating cash investment mix. Banks are the primary source that treasury and finance professionals turn to for information. Most organizations' cash holdings are held in bank deposits; practitioners value their bank-related investments differently than they do other investment vehicles.'"
Our MF Symposium recap reads, "Two weeks ago Crane Data hosted its 11th annual Money Fund Symposium conference in Boston, and the record 584 attendees were feeling little pain after a decade of ultra-low interest rates and dramatic regulatory and product shifts. But though asset flows and revenue streams are extremely healthy now, the threat of falling rates again cast a shadow over the proceedings."
Host Peter Crane comments, "Last year, you saw a surge in retail money market fund assets and prime retail assets in particular.... Then this year institutions joined in. If you look at the latest [ICI] numbers … they're pushing $3.2 trillion. Over 52 weeks ... assets are up 13%.... I believe money funds will be up 20 percent in 2019."
He adds, "The most amazing thing is that they're up during the weakest seasonal period of the year.... Assets in the second half are always super strong. So I'm expecting a mother of inflows in this second half of the year. If you look at the SEC's statistics, their numbers are over $3.5 trillion.... But no matter which series you look at, the numbers are surging ... and the prime numbers are spectacular.... Prime assets are up 50% year-over-year. They're over $1 trillion now if you look at the SEC's or Crane Data's stats."
Our "Worldwide" update says, "The Investment Company Institute's latest 'Worldwide Regulated Open-Fund Assets and Flows, First Quarter 2019' shows that money fund assets globally rose by $83.7 billion, or 1.4%, in Q1'19, to break above the $6.1 trillion level ($6.160T). The increase was led by big gains in Chinese and U.S.-based money funds. Money fund assets in Ireland fell. MMF assets worldwide have increased by $62.1 billion, or 1.0%, the past 12 months, and money funds in the U.S. continue to represent exactly 50.0% of worldwide assets."
The latest MFI also includes the News Brief, "MMF Assets Blasting Off." It explains, "Money fund assets broke through the $3.2 trillion level as Institutional MMFs surged to $2.0 trillion in ICI's latest data series, their 11th week in a row of gains. Over the past 52 weeks, ICI shows assets increasing by $417 billion, or 14.8%, with Retail MMFs rising by $206 billion (20.0%) and Inst MMFs rising by $210 billion (11.8%)."
Our July MFI XLS, with June 30, 2019, data, shows total assets rose by $40.0 billion in June to $3.541 trillion, after rising $91.1 billion in May, $105.7 billion in April (this included the addition of the $108 billion American Funds Central Cash Fund) and falling $10.2 billion in March. Our broad Crane Money Fund Average 7-Day Yield fell to 2.03% during the month, while our Crane 100 Money Fund Index (the 100 largest taxable funds) was down 4 basis points to 2.18%.
On a Gross Yield Basis (7-Day) (before expenses are taken out), the Crane MFA fell 4 basis points to 2.44% and the Crane 100 fell to 2.45%. Charged Expenses averaged 0.41% (unchanged) and 0.27% (unchanged), respectively for the Crane MFA and Crane 100. The average WAM (weighted average maturity) for the Crane MFA and Crane 100 was 28 and 30 days, respectively (down one day for both). (See our Crane Index or craneindexes.xlsx history file for more on our averages.)
