In an effort to help advisors meet regulatory requirements, State Street Corp. launched a suite of money maket funds services.
The services are designed to help advisors comply with new amendments to the Rule 2a-7 regulations governing money funds. State Street [STT] said in a press release Wednesday that the suite of services help “manage new liquidity, maturity and credit quality guidelines for disclosure and reporting.”
“This comprehensive suite of money market fund services is specifically designed to help advisors meet the requirements of the regulations without having to invest in additional infrastructure,” Alan Greene, an executive vice president of global services for State Street, said in a press release. “State Street’s solution provides a range of stress tests to help clients assess the stability of their portfolios in times of market turmoil, as well as new calculations, reporting and filings to help clients meet all of the new SEC guidelines.”
The new capabilities include new weighted average life calculation and a monthly portfolio of investment statements and data. State Street will also aggregate data to prepare the new Form N-MFP for SEC filing on a monthly basis. The stress tests detail fund performance in response to hypothetical market scenarios, supplying fund managers with the analytical information necessary to assess a fund’s ability to maintain a stable NAV.
Pre-set scenarios that are tested include interest rate shifts, increased shareholder redemptions, downgrades or defaults on portfolio securities, widening and narrowing of spreads, and “combination events.”
The analytics package can also perform historical stress tests based on past crisis events, such as assessing the impact of the market events of September 2008 on a fund’s current portfolio holdings. These stress tests can be generated on a monthly, weekly or daily basis.