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ABI announces new Money Market sector

The ABI has announced the creation of a new investment fund sector, called the Deposit & Treasury sector.  The new sector will have stricter limits on the type of instruments funds can invest in and their maturity than the existing Money Market sector, which will continue to exist.


The new sector, available on 1 November 2009, is a response to extensive consultation, including from the FSA, which showed demand for a sector whose principal and overriding objective is the stability of capital.  The new Deposit & Treasury sector will therefore contain money market funds that are only allowed to invest in relatively simple instruments, such as time deposits or Government bonds. All instruments held by funds in the new sector must be denominated in Sterling and have a maximum duration of 12 months.


Maggie Craig, the ABI's Director of Life and Savings, said:


"This move is good news for consumers.  It will make it easier for people seeking stability during the current volatility.  Whilst no fund is risk free, the new sector will only contain the simplest funds available."


The ABI Life and Pension Sectors are a system for the classification of investment funds. Each sector has clear criteria that must be followed by funds wishing to belong to it. There are currently 34 different ABI Sectors, with over 7,000 funds classified within them. The Sectors aim to help consumers, and advisers, find investment funds with similar investment strategies so they can choose the best funds for their needs.


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Last updated 01/07/2016