Guide to Money Market Funds (2024)

Triple-A Rated Money Market Fund Guidelines

Money market funds can apply for the highest rating from the Nationally Recognized Statistical Rating Organizations (NRSROs), which can include Standard & Poor’s Ratings Group, Moody’s Investors Service, Inc., and/or Fitch Ratings. In addition to meeting Rule 2a-7 guidelines, money market funds must meet additional requirements in order to maintain the highest rating from the different NRSROs. The rating agencies also perform regular surveillance of top-rated funds to ensure a fund is complying with the more stringent guidelines. Below is a high-level overview of the rating agencies’ requirements, although it is important to note that this list is not exhaustive, and the requirements are always at the discretion.

Minimum Credit Rating

• Moody’s: No explicit limit. Rating is determined by Moody’s scorecard.
• S&P: Min A-1+ or A-1;*
• Fitch: F1+ or F1 (short term)

Maturity

• Moody’s: No explicit limit. Rating is determined by Moody’s scorecard.
• S&P: WAM: 60 Days; WAL 90-120 Days*
• Fitch: WAM: 60 Days; WAL 120 Days

NRSRO’s Highest Ratings Definitions

• Standard & Poor’s AAAm rating:“Extremely strong capacity to maintain principal stability and limit exposure to principal losses due to credit market and/or liquidity risks.” (For further information on the rating criteria of Standard & Poor's, please follow thislink.)


• Moody’s Investors Service Aaa-mf rating:“Very strong ability to meet the dual objectives of providing liquidity and preserving capital..” (For further information on the rating criteria of Moody's Investor Services, please follow thislink.)


• Fitch RatingsAAA/mmfrating:“Extremely strong capacity to achieve money market fund’s investment objective of preserving principal and providing shareholder liquidity through limiting credit, market, and liquidity risk.” (For further information on the rating criteria of Fitch Ratings, please follow thislink.)

Ratings are subject to change and do not imply the elimination of risk
Note: Each NRSRO’s guidelines could be more or less restrictive.
Note: Standard & Poor’s Fund Ratings represent an opinion only, not a recommendation to buy or sell.

First and Second Tier Securities

What is a First Tier Security?*

What is a Second Tier Security?*

Note: An unrated security can also be a First Tier security if it has comparable quality to a rated First Tier Security as determined by the Fund’s investment advisor.

Note: An eligible security is a rated security with a remaining maturity of 397 calendar days or less that has received a rating from an NRSRO in one of the two highest short-term categories or any unrated security of comparable quality.

*Source: iMoneyNet Money Fund Vision(98) and Goldman Sachs Asset Management

General Rating Guidelines

For further information on the rating criteria, please refer to the official websites ofStandard & Poor's Ratings Group (S&P),Moody's Investors Service, Inc andFitch Ratings.

External Resources