Regulators are searching for ways to make money market funds stronger without inadvertently crippling the $3.7 trillion industry, but reaching that delicate balance will require compromises from both sides.

"We are seeking to strike a proper balance and find changes that make sense in times of stormy weather and calm waters," said Andrew "Buddy" Donohue, director of the Securities and Exchange Commission's division of investment management. "A ship incased in armor might survive a collision, but it could sink under its own weight."

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.