break the buck


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break the buck

In US money market funds, to have the value of a company's individual shares fall below one dollar (in slang, referred to as a "buck"). During the recession, a great number of companies that broke the buck ended up closing altogether.
See also: break, buck

break the buck

To fall below the value of one dollar. Used of the net asset value of a mutual fund, especially a money market fund.
See also: break, buck
References in periodicals archive ?
89) The "first mover advantage" is the investor's incentive to make early redemptions from a stable NAV fund (90) when the investor perceives that the redemptions will continue until all liquidity is removed from the fund and the fund will break the buck, thereby potentially causing the investor to lose money if he redeems his shares.
Note the difference between this case and an intermediary's solvency constraint, where the MMF does not break the buck when it can pay all creditors a minimum gross return of 1, whereas the intermediary has to pay the promised interest to the creditors to be solvent.
The fund does not break the buck at t = 2 if and only if it can pay a return of 1 to all creditors, that is, when [theta]y + [chi]([alpha])(m - [alpha](1 - [mu])) [greater than or equal to] [alpha][mu] + 1 - [alpha], which gives us
The important difference between this proposal and the first proposal, where the creditors that redeem at t = 1 become junior debtholders at t = 2, is that in this case early withdrawals generate an equity cushion so that the region over which the fund does not break the buck widens.
government agency recently looked at what might happen to money funds if the eurozone's problems grew or some corporations defaulted on debt and "found so many funds would break the buck that the conclusions were considered too alarming to publish.
After the break the Bucks dominated possession but struggled to find a breakthrough as Phil Trainer and Chris Sharp both missed chances.