A Comparative Study On China-American Money Market Fund

The money market fund has rapidly changed the former mode of the American mutual fundtrade, since its appearance in 1970's. Before 1970's it was the stock market fund thatdominated the American mutual fund market. But in the 10 to 20 years that followed, themoney market fund developed very quickly. In 1980, the number of the money market fundhad reached 106, and rose up to 959 in 1990, the climax in its history, accounting for 24.1% ofthe total amount of the US mutual funds. While at the beginning of the twenty-first century,the boom of the money market fund has been held down, but still retained the level.From December 2003, when China issued its first money market fund---Hua An Cash Fu Li,to March 2006, China has issued over thirty money market funds, and achieved excellentachievements. A variety of signs shows that the development of China's money market fundsis in the ascendant.This paper attempts to conduct the studies on the money market fund from the following 5parts:Part A gives an introduction to the definition, characteristics and advantages of the moneymarket fund from the perspective of the related theory of the money market fund.Part B conducts an intensive analysis on the current condition and development cause of themoney market fund. Through illustrating the tremendous difference in the generativebackground, current situation and reason for sustainable development between China's and USmoney market funds by demonstration and comparison, this part paves the way for the cominganalysis.Part C offers some beneficial experiences and visions as a conclusion, which would beconducive to the fast and benign development of China's incipient money market funds.Part D conducts a specific analysis on the investment strategy of US money market funds,which reveals that US pension funds have an obvious positive effect relation with moneymarket funds. This finding would provide a valuable reference for the investment strategychoice of China's money market funds.Part E sets forth an investment strategy on the precondition of safety and mobility, trying tofind a new transformative way for China's money market funds, of which the core suggestionsis that making the money market fund as the investment tool for China's pension funds is notonly one of the effective strategies for the long-term development of China's funds, but also onekey component to establish and improve China's social security system. Only in this way canthe positive effect relation between pension funds and money funds be brought into full play,realizing the benign interaction and common development between them.