Fidelity is urging investors to choose their cash funds carefully as many are not as low risk as they appear and some could have exposure to sub-prime debt.
Many investors have been switching from equities and bonds into cash in a bid to escape recent market volatility brought about by the sub-prime mortgage crisis. However, Fidelity is urging investors to look before they leap into cash funds as the two main types, investment and treasury, have different risk profiles. It says investment style money market funds (also known as enhanced yield funds) take a level of risk to get returns while treasury funds predominantly seek capital preservation. Fidelity says its funds are treasury style and warns investors could be pouring cash into investm...
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