Research On The Liquidity Risk Of Internet Money Market Fund

Since China’s accession to the Internet, the corresponding changes have taken place in all walks of life. Combination of the financial sector and the Internet generates the concept of Internet Finance. The father of China’s Internet Finance divides it into six categories, one of which is Internet Finance Products. The Internet Money Fund is a small risk product belonged to the Internet Finance Products. As the Internet Money Fund is convenient and high-yield, for investors, compared with traditional Money Market Fund, the Internet Money Market Fund is more attractive. In the case of the Internet Money Market Fund so hot, the risk of it is often ignored. In these risks, liquidity risk is a kind of risk which has a great impact on the Internet Money Market Fund. Faced with this financial innovation product, investors tend to be attracted by its advantages, while ignoring its liquidity risk, and fund managers are not performing perfectly in the management of its liquidity risk.We select the broad definition of the Internet Money Market Fund, and the liquidity risk is defined as the endogenous liquidity risk. On this basis, this paper selects the top five Internet Money Market Funds, and introduces their basic situation and the liquidity risk from four aspects—— fund size, operating performance, asset allocation and holder structure—— respectively. And then, starting from the current situation of the liquidity risk of the Internet Money Market Fund, this paper analyzes the liquidity risk of the top five Internet Money Market Funds, and obtains three conclusions, and further analyzes the four issues in the management of liquidity risk. At last, in view of the conclusions and the questions, this paper gives suggestion from three angles of individual investors, institutional investors and fund managers.