A Spotlight of How to Structure Your Marketing Funds

Another issue that this idea will address is that uninterested prospects are no longer named and are now searching the Internet for knowledge. If your prospect is willing to pay a small fee for a device or product that they are interested in, they are a far more eligible prospect with whom to spend time.SEC Rule 204a-7 governs the development of money market funds in the United States. Money market funds cannot have an average maturity date of more than 13 months, according to the rule. To put it another way, the shorter the term to maturity, the lower the financial risk (for short term instruments with the same credit ratings). Yields differ between funds, and some can hold longer-term bonds. While all money market funds are required by rule 204a-7 to keep their average (dollar weighted) maturity below a 90-day window, they are permitted to hold longer-term paper. They can keep any form of paper with a “remaining maturity less than 397 days,” according to the Rule. click to read more

Aside from maturity, the credit rating of the underlying securities is also significant. This is where recent banking industry events make things a bit dicey. Many investors blame credit rating firms (S&P, Moody’s, etc…) for the liquidity collapse in the recent credit crisis. This has made it more difficult for businesses to sell their short-term bonds, even those with decent credit scores in the past (often referred to as “commercial paper”). Along with this, you can look for funds that are fully diversified and have no more than 5% of total assets under management invested in any one issuer’s paper.Although there is no way to fully hedge against systemic risk, money funds have been and continue to be a reliable source of liquidity in a volatile and dangerous market. Since the start of the current financial crisis, a dozen companies have provided direct liquidity support to their money market funds to ensure that their share prices did not “break the buck” (fall below $1).