Circular to management companies of SFC-authorised money market funds

The Securities and Futures Commission (SFC) has issued a circular outlining its requirements and expectations for management companies (Managers) of SFC-authorized money market funds (MMFs). Managers must maintain effective liquidity risk management policies, considering factors such as investment strategy, investor base, liquidity profile, and redemption policy. The SFC emphasizes the importance of prudent investment in high-quality money market instruments and proper assessment of liquidity risks. Recent reviews of Hong Kong domiciled MMFs show no major liquidity issues, but there is room for improvement in liquidity risk management. Managers are encouraged to adopt best practices, including using liquidity risk management tools, ensuring fair treatment of investors, and reviewing their policies to enhance resilience against market changes.

Resources: https://apps.sfc.hk/edistributionWeb/gateway/EN/circular/doc?refNo=24EC64