NETHERLANDS - Netherlands-based Rabobank International and its investment management subsidiary Robeco have together launched a range of six AAA-rated liquidity mutual funds aimed at pension funds.
The Rabo Liquidity funds invest in money market securities and are designed to ensure liquidity, security, service and competitive returns for investors.
The Rabo Liquidity funds have a stable net asset value (SNAV), accruing income on a daily basis and paying dividends at the beginning of each new month. The funds offer daily liquidity and are available in three currencies, euro, US dollar and sterling.
In addition to the three SNAV funds, a range of three enhanced funds is also being introduced. The Rabo Enhanced Liquidity funds are designed to offer better returns for longer-term cash balances, typically in excess of three months, while maintaining one-day liquidity.
These enhanced funds have an accumulating NAV and can be used by investors on an individual basis or in combination with conventional liquidity funds to form a tailored cash management solution.
"The trend for liquidity funds is coming over from the US, where there are already $2.4 trillion in money markets. And we are moving into European money markets because the sector has huge growth potential. Typical liquidity fund investors are corporates, hedge funds, pension funds, local authorities as well as some central banks," said Ian Lloyd, director of Rabobank's sales and product management liquidity funds.
Rabobank originally seeded the six liquidity funds with its own assets in April 2006 but they are being re-launched to attract investor money in response to client demand.