The SEC announced that it is likely to issue new rules requiring some money markets to adopt a floating share price. Thinking they were as safe as cash, investors in money funds liked the $62.5 billion Reserve Primary Fund, which broke the proverbial buck, suffering significant loses during the 2008-2009 recession. Currently, these funds — which invest in securities like short term corporate debt that are thought to be safe (like Lehman?) — list a $1 stable value.
But not all money market funds are created equal. Only 35% of the funds will be affected under the SEC’s proposal, sparing those offered by providers — like Schwab and Vanguard — that invest in government securities (like Greece?).
