Credit risk of Money Market Funds

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drsteph

I'm sure that this has been addressed previously, but a quick search couldn't bring it up, so here goes.

Being that money market funds are not FDIC insured, and that some MM funds hold cmo's and other GSA instruments that may or may not be as stable as we all think;

What treasury type money market fund or instrument do you think would best weather a credit risk situation?

Anyone researched this previously and want to contribute?
 
Quote from drsteph:

I'm sure that this has been addressed previously, but a quick search couldn't bring it up, so here goes.

Being that money market funds are not FDIC insured, and that some MM funds hold cmo's and other GSA instruments that may or may not be as stable as we all think;

What treasury type money market fund or instrument do you think would best weather a credit risk situation?

Anyone researched this previously and want to contribute?
More...

Hey.

I've researched this.

If you want the full faith and credit of U.S. taxpayers to back your money, you are limited to t notes. I am unaware of any federally insured 'money market' in excess of $100,000 in a non-retirement account, or $250,000 in a retirement account, at a FDIC backed financial institution.

By the way, bank money markets are FDIC insured up to the limits described above.

3 and 6 month t notes are not a bad place to be if you seek safe haven. They're both yielding close to or more than the 10 year, I believe.
 
Excellent Commentary
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The straight instruments held at a firm such as Goldman would be the way to go for large amounts...

Any group of securities held in a fund name would be subject to that corporate fund name...

And as you already know...zero coupons tend to edge out the interest paying instruments...

And you are very intelligent in avoiding the company sales lines for money fund stability.....

Everyone is intelligent...after the event has already taken place....
 
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