Media – Blog
May 1, 2011
Reflecting back on the 20 years since Capital Advisors Group was founded, I am amused by the numerous security types that have been created for corporate treasurers and short-term cash portfolios. These new security types, and our ensuing risk evaluation of these securities, have been part of the challenge and
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April 1, 2011
Abstract Recent events related to government sponsored enterprise (GSE) reform have prompted short-duration investors to question the level and nature of government support for their debt issuance after December 31, 2012. The housing GSEs play a critical role in the U.S. mortgage market, representing 99% of all new mortgage-backed securities
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March 1, 2011
It’s human nature to generalize with broad strokes; one bad apple can spoil the whole bunch, as the saying goes. Our industry is filled with generalizations, from panning all insurance companies even when Berkshire Hathaway shines as a pillar of credit strength, to running from all Euro credits even when
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February 1, 2011
Abstract Credit risks in prime money market funds stem from investments in non-government securities. In reviewing credit concentrations in a group of AAA-rated prime funds representing 50% of industry prime fund assets, we found that fund managers improved credit and liquidity positions by boosting investments in U.S. Treasuries and repurchase
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November 1, 2010
Recent Federal Reserve communication has set the stage for additional quantitative easing in November. Not so long ago, “Fed speak” was centered on future steps that the Fed may take to gradually remove stimulus. However, this recent shift in communication has pivoted around a deceleration in growth and declining inflation
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November 1, 2010
Introduction With just two days remaining until the Federal Reserve Board’s key policy meeting, it is almost impossible to avoid the term “quantitative easing round two (QE2)” in the financial press. Ever since the keynote speech by Fed Chairman Ben Bernanke last August , rumors have been rampant that the
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October 4, 2010
Introduction As far as financial weather conditions go, the past few months represented very unusual patterns for financial regulators, who broke the usual summer doldrums with a number of regulatory gales. While the new regulations will likely have a profound and lasting impact on our financial lives, most of us
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September 1, 2010
Abstract With the Fed on hold for an extended period, institutional cash investors need a new perspective on dealing with the prolonged low yield reality. Our four-step guide reminds investors to expect lower yields in the new environment, increase exposure only to securities supported by strong fundamentals, improve yield potential
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August 2, 2010
Abstract This paper attempts to quantify the impact of a liquidity premium in money market funds by modeling three hypothetical portfolios of 29, 60, and 121-day weighted average maturities (WAM). Through our modeling process, we found the WAM extensions would have resulted in 0.11% and 0.31%, respectively, of additional annual
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May 1, 2010
Background Money fund due diligence is among several topics du jour with corporate investors. Prior to the Reserve Primary Fund “breaking the buck” in September 2008, loss of principal and liquidity in a money market fund was barely a concern for most corporate cash investors. Much has occurred in the
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