Requiring money market fund advisers to hold capital to support their money market funds would fundamentally change the nature of these funds, according to a new study by the Investment Company Institute released today.

Depending on the size of the capital buffer and the assets covered, the study revealed that a capital buffer could result in advisers shifting to less regulated products or exiting the cash management business altogether. These changes would not benefit investors and could lead to greater systemic risk in the economy.

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