GLOBAL - Money market funds rose in popularity in 2005 over bank deposits in 2005 for institutional investors, according to a survey by JPMorgan Asset Management.
The annual survey revealed an increase of 16% in the number of respondents who opted for the higher yielding cash management tool.
While 51% of those surveyed still said they still used bank deposits, this figure was down from 67% in 2004 and 72% in 2003.
The research also revealed treasures where unwilling to accept funds with a below BBB rating from the credit agencies.
The Survey also reveals that the move towards global cash management structures continues to gain pace, at the expense of regional management. 28% of respondents said they manage cash globally, and 36% said they manage cash regionally with global oversight, compared to just 13% who manage cash regionally, 10% who manage cash locally with regional oversight and 13% who manage cash with local autonomy. Robert Deutsch, head of global cash at JPMorgan Asset Management, said: “The appetite for money market funds is still high and in the future it is expected that those who are considering investing in pooled funds will look increasingly to money market funds to fulfil their cash management needs.”
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