![]() ![]() ![]() LLC are neither deposits nor obligations of, nor endorsed, nor guaranteed by any bank or other insured depository institution, nor are they insured by the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other government agency. LLC, distributor of the Fund(s), is not a bank, and Fund shares distributed by Goldman, Sachs & Co. The Standardized 7-Day Current Yield may differ slightly from the actual distribution rate of a given portfolio because of the exclusion of distributed capital gains, which are non-recurring. The Standardized 7-Day Current Yield is calculated in accordance with securities industry regulations and does not include capital gains. Views and opinions are current as of the date of this material and may be subject to change, they should not be construed as investment advice. Views and opinions expressed are for informational purposes only and do not constitute a recommendation by Goldman Sachs Asset Management to buy, sell, or hold any security. This material is not intended to be used as a general guide to investing, or as a source of any specific investment recommendations, and makes no implied or express recommendations concerning the manner in which any client’s account should or would be handled, as appropriate investment strategies depend upon the client’s investment objectives. This material is provided for informational purposes only and should not be construed as investment advice or an offer or solicitation to buy or sell securities. The value of investments and the income derived from investments will fluctuate and can go down as well as up. Past performance does not guarantee future results, which may vary. Prospective investors should inform themselves as to any applicable legal requirements and taxation and exchange control regulations in the countries of their citizenship, residence or domicile which might be relevant. ![]() THIS MATERIAL DOES NOT CONSTITUTE AN OFFER OR SOLICITATION IN ANY JURISDICTION WHERE OR TO ANY PERSON TO WHOM IT WOULD BE UNAUTHORIZED OR UNLAWFUL TO DO SO. ![]() The Fund's sponsor has no legal obligation to provide financial support to the Fund, and you should not expect that the sponsor will provide financial support to the Fund at any time. Institutional money market funds may have floating net asset values, and will fluctuate depending on market conditions. Money market funds are not subject to credit risk, but will have interest rate risk. An investment in the Fund is not a deposit of the bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. You could lose money by investing in a money market fund. For this reason, our view is that investors seeking to capitalize on increases in global central banks’ policy rates should consider MMFs for their cash. This means that depositors’ yield potential is inherently constrained by banks’ balance sheet and funding needs. While rate hikes are reflected in the assets held by MMFs (subject to the underlying portfolio positioning), deposit rates are dictated entirely by individual banks. MMFs are diversified portfolios of highly liquid assets, while bank deposits are unsecured liabilities on banks’ balance sheets. This difference is largely attributable to the structural differences between MMFs and bank deposits. But by early 2019, there was about a 200-basis-point difference between the average yield on MMFs that invest in US government debt and the national deposit rate for 3M CDs (see figure 1). During the last cycle, which began in late 2015, bank deposit rates exceeded the federal funds for about a month after the Federal Reserve’s first rate hike. However, it is important to keep in mind that bank deposit rates have historically lagged rate hikes and MMF yields once a hiking cycle is underway. Some bank deposit rates may exceed MMF yields in the early stages of a rate hiking cycle. Rate rises should change that, as they are expected to increase yield potential for cash investors and cause spreads between MMF yields and bank deposit rates to widen. As a result, yield had not been a point of differentiation between MMFs and bank deposits. Yield on cash was especially hard to come by during the last two years’ low interest rate environment. ![]()
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