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Case
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Reference no. 9-310-135
Published by: Harvard Business Publishing
Originally published in: 2010
Version: 18 August 2010
Revision date: 27-Nov-2018
Length: 16 pages
Data source: Generalised experience

Abstract

After an incredibly volatile six months since Lehman Brothers declared bankruptcy, Finbar McCall contemplated his options. As the investment manager of RPG Prime Reserve Fund, Inc (RPGXX), McCall had just heard the news that the US. Treasury was extending the availability of insurance for eligible money market funds. When the insurance was first offered in September of 2008, RPGXX immediately applied for coverage. McCall''s dilemma in February of 2009, when an extension of the Treasury insurance was offered, involved weighing the cost of the insurance against the comfort it might provide to skittish RPGXX shareholders and the increased flexibility it would allow in investing RPGXX''s assets. This case provides a brief history and explanation of money market funds, the phenomenon known as ''breaking the buck,'' and how the government''s assistance changed the landscape of money market funds in the last months of 2008 and into 2009.
Industry:
Other setting(s):
2008-2009

About

Abstract

After an incredibly volatile six months since Lehman Brothers declared bankruptcy, Finbar McCall contemplated his options. As the investment manager of RPG Prime Reserve Fund, Inc (RPGXX), McCall had just heard the news that the US. Treasury was extending the availability of insurance for eligible money market funds. When the insurance was first offered in September of 2008, RPGXX immediately applied for coverage. McCall''s dilemma in February of 2009, when an extension of the Treasury insurance was offered, involved weighing the cost of the insurance against the comfort it might provide to skittish RPGXX shareholders and the increased flexibility it would allow in investing RPGXX''s assets. This case provides a brief history and explanation of money market funds, the phenomenon known as ''breaking the buck,'' and how the government''s assistance changed the landscape of money market funds in the last months of 2008 and into 2009.

Settings

Industry:
Other setting(s):
2008-2009

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