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Exploring money market funds

Overview of money market funds

Through Flexible Cash Funds you can invest in low volatility net asset value (LVNAV) money market funds (MMFs), managed by FIL Investment Management (Luxembourg) S.A., Ireland branch.
This entity is regulated by both the Commission de Surveillance du Secteur Financier (CSSF) and the Central Bank of Ireland (CBI), providing a high standard of oversight. These MMFs are sub-funds of Fidelity Institutional Liquidity Fund plc, an open-ended umbrella fund authorised by the Central Bank of Ireland (registration number: 235175). Both entities are part of the Fidelity group, one of the largest asset managers.

These funds include:

  • The Euro Fund (ISIN IE000AZVL3K0)
  • The USD Fund (ISIN IE000H9J0QX4)
  • The Sterling Fund (ISIN IE0002RUHW32)

You invest in Class R Flex Distributing shares of the Fund that matches the currency of the Flexible Cash Funds currency you selected. For further information on these funds, please refer to the fund’s prospectus and the respective key information document (KID) available in the app (Flexible Cash Funds homepage → 'Details' → Documents section) and on Fidelity’s website.

Characteristics of LVNAV funds

LVNAV stands for low volatility net asset value. LVNAV MMFs are a particular type of money market fund that aim to preserve the value of your money and deliver growth in line with money market rates. Short-term MMF invest in very liquid instruments that have a weighted average maturity of 60 days and other strict liquidity rules.
LVNAV MMFs seek to maintain the share price constant by closely monitoring the composition and the valuation of the underlying instruments per the applicable money market funds regulation, Regulation (EU) 2017/1131.
All these characteristics make short-term LVNAV MMFs low-risk investments with high liquidity.

Investment strategy of MMFs

Money market funds invest in a diverse array of high-quality financial instruments, including government securities, bank obligations, and commercial paper, among others. These investments are a low-risk, stable, and liquid option for investors who want to preserve capital. Detailed investment objectives and policies can be found in Fidelity's prospectus under the 'Investment objective and policies' section.