IDEAS home Printed from https://ideas.repec.org/a/fip/fedreq/y2012i4qp231-254nv.98no.4.html
   My bibliography  Save this article

Some theoretical considerations regarding net asset values for money market funds

Author

Listed:
  • Huberto M. Ennis

Abstract

The instability of money market mutual funds is a subject of active debate. A new regulatory framework is likely to be implemented soon in the United States. The design of such a framework should depend on an assessment of which is the main economic function fulfilled by these funds. If money funds are providing maturity transformation, then redemption values that permanently reflect the market value of assets may be hard to compute and may undermine the purpose of the funds. If funds are mainly investment managers, then market-based redemption values can be appropriate and increase the stability of the funds.

Suggested Citation

  • Huberto M. Ennis, 2012. "Some theoretical considerations regarding net asset values for money market funds," Economic Quarterly, Federal Reserve Bank of Richmond, issue 4Q, pages 231-254.
  • Handle: RePEc:fip:fedreq:y:2012:i:4q:p:231-254:n:v.98no.4
    as

    Download full text from publisher

    File URL: http://www.richmondfed.org/publications/research/economic_quarterly/2012/q4/ennis.cfm
    Download Restriction: no

    File URL: http://www.richmondfed.org/publications/research/economic_quarterly/2012/q4/pdf/ennis.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Douglas W. Diamond & Philip H. Dybvig, 2000. "Bank runs, deposit insurance, and liquidity," Quarterly Review, Federal Reserve Bank of Minneapolis, issue Win, pages 14-23.
    2. Burcu Duygan-Bump & Patrick Parkinson & Eric Rosengren & Gustavo A. Suarez & Paul Willen, 2013. "How Effective Were the Federal Reserve Emergency Liquidity Facilities? Evidence from the Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility," Journal of Finance, American Finance Association, vol. 68(2), pages 715-737, April.
    3. Rosen, Kenneth T & Katz, Larry, 1983. " Money Market Mutual Funds: An Experiment in Ad Hoc Deregulation: A Note," Journal of Finance, American Finance Association, vol. 38(3), pages 1011-1017, June.
    4. Xavier Freixas & Jean-Charles Rochet, 2008. "Microeconomics of Banking, 2nd Edition," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262062704, January.
    5. Patrick E. McCabe & Marco Cipriani & Michael Holscher & Antoine Martin, 2012. "The minimum balance at risk: a proposal to mitigate the systemic risks posed by money market funds," Finance and Economics Discussion Series 2012-47, Board of Governors of the Federal Reserve System (U.S.).
    6. Cecilia Parlatore Siritto, 2013. "The Regulation of Money Market Funds: Adding Discipline to the Policy Debate," 2013 Meeting Papers 102, Society for Economic Dynamics.
    7. Jeremy C. Stein, 2005. "Why are Most Funds Open-End? Competition and the Limits of Arbitrage," The Quarterly Journal of Economics, Oxford University Press, vol. 120(1), pages 247-272.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Parlatore, Cecilia, 2015. "Fragility in money marketfunds: sponsor support and regulation," Working Paper Series 1772, European Central Bank.
    2. Parlatore, Cecilia, 2016. "Fragility in money market funds: Sponsor support and regulation," Journal of Financial Economics, Elsevier, vol. 121(3), pages 595-623.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fip:fedreq:y:2012:i:4q:p:231-254:n:v.98no.4. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christian Pascasio). General contact details of provider: http://edirc.repec.org/data/frbrius.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.