A qualifying money market fund is a type of short-term money market fund that under MiFID II is approved to hold regulated client money.
Along with meeting client money safeguarding requirements, qualifying money market funds are managed for capital preservation, high levels of liquidity, and generate an attractive cash return.
Cash is accessible at multiple points during the day and deposited directly into authorized firms' designated bank accounts.
Dividend interest can be separated from redemption proceeds, allowing for authorized firms to account for it separately.
Qualifying money market funds themselves are tightly regulated under the MiFID II client money rules and the EU Money Market Fund Regulation, along with being triple A-rated by rating agencies.
Insight Investment is a leading asset and risk manager and one of the largest fixed-income managers in Europe.
We are a subsidiary of BNY and are the designated fixed-income manager for the group. Managing money market funds is one of our core competencies based on over 20 years of experience.
Our money market funds, available in euro, sterling, and US dollars, are among the few in the sector to be authorized by the Central Bank of Ireland as qualifying money market funds, which has been noted in the fund's documentation.
This is an important step, as authorized firms must demonstrate to their regulator that they are following client money rules when assessing if a fund meets the criteria of a qualifying money market fund.
This burden lies solely with the firm holding the client money, so not the regulator, nor the asset manager.
Having taken the extra step of updating our fund documentation with qualifying money market fund language, firms should take comfort that we are following the regulation and have the necessary governance in place to adhere to it in future.
As it stands, Insight is one of the only money market fund providers to have taken this extra step of including this language in the fund documentation.
As a result, Insight's qualifying money market fund range safeguards assets in line with client money regulation while separating dividend interest from redemption proceeds, allowing for authorized firms to earn more interest income on their client money.
If you have any questions, we'd be more than happy to support you at this time, so please do get in touch.
