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AFP Raises MMF Concerns to International Regulators

  • By Staff Writers
  • Published: 2012-05-30

Continuing its efforts to fight additional regulations to money market funds (MMFs), AFP submitted formal comments to Masamichi Kono, Chairman, Technical Committee of the International Organization of Securities Commissions (IOSCO).

"We oppose the proposal to eliminate the stable NAV in favor of a floating NAV, as we believe it would greatly reduce investors' interest in utilizing MMFs as a cash management and investment tool, whether applied to all investors or just institutional investors," the comment letter states. "For purchasers of MMFs, the return of principal is a much greater driver of the investment decision than return on principal. For a large number of institutional investors, the potential of principal loss would preclude investing in floating NAV MMFs."

Read the full comment letter to IOSCO here.

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