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ARTICLE · 10 JULY 2018

Money Market Reform Measures

Cayman Finance
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MMFs are considered by many investors to be a relatively safe and highly liquid investment alternative to simply holding surplus cash in a bank account.

Cayman IslandsFinance and Banking
Chris Capewell
Chris Capewell
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WHY CAYMAN MAY BE THE BEST FIT



At their most basic level, money market funds ("MMFs" and each an "MMF") are funds that invest in high quality, low-risk, short term debt securities, with the aim of providing a greater return to investors than the interest (if any) that might be paid on their surplus cash balances. MMFs are considered by many investors to be a relatively safe and highly liquid investment alternative to simply holding surplus cash in a bank account.

MMFs aim to maintain a constant net asset value ("CNAV") of USD1.00 while generating a low rate of return, eg. through dividends. MMFs attract an extraordinary amount of investor capital, with some funds holding tens of billions in assets - in aggregate regulated MMFs in the US and MMFs in Europe currently hold around USD4 trillion in assets.

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