In Standard & Poor's view, cash management funds seek to maintain a stable NAV (net asset value) and should be managed conservatively with well-defined guidelines and investment policies with regard to average maturity, credit quality, and liquidity. (Funds managed outside these guidelines may be rated using Standard & Poor's fund credit quality ratings criteria.)
Cash Management Funds underlying investments must have the highest ratings from Standard & Poor's. The fund must have very low sensitivity to interest-rate risks with a weighted average maturity of 70 days or less.
Formerly known as a "Cash Management Fund Rating", a Standard & Poor's principal stability fund rating is a current opinion of a fund's capacity to maintain stable principal or net asset value (NAV).
When assigning a principal stability rating to a fund, Standard & Poor's evaluates the creditworthiness of its investments and counterparties, the market price exposure of its investments, sufficiency of portfolio liquidity, and management's ability and policies to maintain its stable NAV by limiting exposure to loss.
Principal stability fund ratings express Standard & Poor's opinion regarding a fund's ability to maintain principal stability and to limit exposure to losses due to credit, market, or liquidity risks. The ratings categories range from 'AAAm' to 'BBBm'.
Reports are available to subscribers of Standard & Poor's subscription website.
