Research On The Effect Of Quick Redemption Mechanism On Monetary Fund Liquidity Risk

On May 30,2018,the China securities regulatory commission and the people's bank of China jointly issued notice no.10 "guidance on further regulating the Internet sales and redemption of money market funds",which will take effect on June 1,2018.The introduction of the new rules will enable fund companies to rectify the original quick redemption mode.In this paper,under the background of the new rules,the author will analyze which aspects of the establishment of the quick redemption mechanism can affect the fund liquidity risk.This paper will take G fund company as the case enterprise for research and analysis.With the method of case study,under the background of the introduction of new regulations,it will introduce the operation mode of the quick redemption mechanism of G fund company and analyze its rectification process.This paper will obtain primary data in the form of interviews,and use the actual operation data of G fund company as the basis for quantitative verification.Through the content of the interview and the rectification direction required by the new regulation,the influencing factors of the liquidity risk of fund companies were determined.It mainly includes several modes,such as the choice of the underlying investors,the concentration of fund shares,the growth rate of fund scale and the redemption method of fund,using the research method of financial asset liquidity risk L-VAR method for quantitative test.The verification results show that the fund liquidity risk can be reduced by restricting the capital cushion,limiting the concentration of fund shares,limiting the rapid growth of fund scale and restricting the redemption of funds.Finally,it analyzes the characteristic practices of G fund companies that are different from the new rules when they construct their quick redemption models.It is concluded that reasonable selection of cushion investors can effectively reduce costs,retain sufficient liquidity assets to deal with liquidity risks,and relying on large sales agency is more conducive to fund companies to the majority of investors.At the same time,restricting the proportion of institutional investors can reduce the liquidity risk of large redemption,extend the investment term,obtain high yield and attract retail investors,which can serve as a reference for other fund companies.There are 16 figures,9 tables and 50 references in this paper.