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What does money market reform mean to me?

The Securities and Exchange Commission (SEC) rules aren't expected to affect you as an individual investor in retail money market funds.

Our money market fund lineup

Government funds

These funds are available to all investors. They seek to maintain a stable $1 share price.

Money market fund details

Look up expense ratios, prices, yields, and more.

Accounts eligible for retail money market funds

(as of September 30, 2015)


Account

ELIGIBLE

Individual

Joint

UTMA/UGMA

Custodian

Education Savings Account

INELIGIBLE

Hospital

Foundation (charitable entity)

School district/political subdivision

Corporation

Unincorporated/nonexempt

Endowment (charitable entity)

Unincorporated/exempt

Professional corporation/association

Partnership


Trusts, sole proprietorships & Vanguard Variable Annuity

ELIGIBLE

Depends on registration

INELIGIBLE

Depends on registration

We'll automatically classify an account as institutional if we can't definitively determine that all owners of the account are people.

Source: Securities and Exchange Commission, 2015.

At Vanguard, it's business as usual

We manage our funds conservatively and have always made safety and liquidity a priority.

Because we focus on the highest-quality, short-term money market instruments, we remain confident in the stability of our money market funds.

We expect no changes in our investment philosophies, objectives, strategies, and overall portfolio management processes as a result of the SEC rules.

The liquidity levels of Vanguard Prime Money Market Fund

Money market funds & your investment plan

With money market fund yields near zero since late 2008, should you consider moving some portion of your cash allocation into higher-yielding, short-term fixed income options? Here are some factors to weigh:

Additional risks

Short-term fixed income options come with additional risks: floating net asset values (NAVs), securities that are less liquid than money market securities, and longer durations.

Fees & gates

The possibility of fees and gates—even if they're unlikely on funds for individual investors—adds a new wrinkle. How important is it that you be able to access all of your cash assets without some delay or reduction in value?

Cash management strategy

If you currently invest in a tax-exempt money market fund* as your settlement fund, you'll need to consider how that fund fits into your overall cash management strategy. You may want to keep the tax-exempt fund as a holding in your portfolio and only move enough money to settle trades into the Federal Money Market Fund**.

Ultimately, you'll need to balance these factors with your expectations of returns and consider which money market fund option best suits your needs or if a broader set of cash or short-term products is right for you.

We're here to help

If you're already a Vanguard client:

Call 800-499-9829

Monday through Friday
8 a.m. to 10 p.m., Eastern time

REFERENCE CONTENT

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The liquidity levels of Vanguard Prime Money Market Fund

This chart shows the liquidity levels of Vanguard Prime Money Market Fund from January 2008 through June 2016. From May 2010, when the SEC imposed liquidity requirements, the liquidity of Prime Money Market has remained above the 30% threshold that could potentially lead the fund's board to impose fees and/or gates.

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Settlement fund

A mutual fund used to pay for and receive proceeds from trades in your brokerage account.

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Duration

A measure of the sensitivity of a fixed income investment's price to a change in interest rates. Duration is expressed as a number of years. The longer the duration, the greater the interest rate risk or reward for bond prices.