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Why is a triple-A rated fund limited to a 60-day average maturity?

April 26, 2017average fund limited maturity rated triple-a

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Why is a triple-A rated fund limited to a 60-day average maturity?

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The weighted average maturity (WAM) of funds is specifically restricted by rating category. Triple-A rated money market funds are required to stay within a 60-day limit. The limit seeks to control exposure to shifts in interest rates and represents an optimal level derived from portfolio stress-testing analysis.