What Should I Know About Mutual Fund Redemptions?

Investors should know that a mutual fund company must pay redemption proceeds within seven days, except in certain emergencies or for such other periods as the Commission may by order permit for the protection of security holders of the company.

On September 22, 2008, the SEC issued a temporary order permitting the Primary Fund and the U.S. Government Fund – each a series of The Reserve Fund – to suspend redemptions and the payment of redemption proceeds. This order will remain in effect until the markets are liquid to a degree that enables each fund to liquidate portfolio securities without impairing the net asset value of each fund, or until the Commission rescinds the order.

Investors can find information on money market funds, such as materials relating to the Commission’s order and the Department of Treasury’s temporary guarantee program, on a new page on our web site focused on recent market events, which is available at www.sec.gov/answers/marketevents.shtml. We plan to regularly update the page, which also contains information on short selling and brokerage accounts, with investor alerts and other helpful information for individual investors.