Stronghold Money Fund Assets Is a Relatively New Money Market

Short Answer

Stronghold Money Fund Assets is a relatively new money market fund with about $400 million in total financial assets and shares outstanding (each maintained at a value of $1.00 per share). Most of the fund's accounts represent the savings of high-income, interest-sensitive financial market investors. Stronghold's current distribution of financial assets currently is as follows:
Interest rates are expected to rise substantially in the money market over the next several weeks or months and Stronghold's management is concerned that its relatively low current yield (a seven-day average of 4.05 percent, one of the lowest yields among existing money funds) may result in the loss of many of its more interest-sensitive share accounts. The fund's average maturity is currently at 34 days, also substantially less than the industry's current average maturity of about 45 days. What steps would you recommend to help Stronghold Money Fund prepare for an apparent impending change in the money fund's condition?