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Article: Money funds finer from Fed's interest rate hikes.(Business)
- Article from:
- The Boston Herald
- Article date:
- July 24, 2005
- Author:
CopyrightCOPYRIGHT 2005 Boston Herald. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Byline: Chuck Jaffe
In the next week or two, the yields on some of the biggest money market mutual funds will top 3 percent.
That should be enough to get some investors excited about money funds again.
In-flows into the safest form of mutual fund have picked up recently, as the Federal Reserve Board's spate of interest rate increases created a five-fold gain in the yield of the average money fund. Average taxable money funds now sport their best yield since the fall of 2001, at roughly 2.7 percent; top performers are already north of the 3 percent line.
"There is no secret to money fund yields; take the Fed funds target and subtract a ...