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break the buck
verb
Fall below the value of one dollar per share.
Exact(39)
To break the buck, its value must fall by one-half of 1 percent, to 99.5 cents a share.
In practice, that means that as long as the value remains at or above 99.5 cents, the fund will not break the buck.
Money-market funds can be subject to runs if investors fear they will break the buck; there is every incentive to exit the fund before losses are imposed.
The Reserve Primary Fund, one of the U.S.'s major money-market funds, announced on September 16 that it would "break the buck".
In more than two dozen cases, managers have had to shore up such funds to ensure they do not "break the buck", causing investors to lose money.
But if investors demanded their money back at a time when Treasury bills were illiquid, money-market funds might be forced to suspend resumptions or "break the buck".
Similar(21)
But breaking the buck is not actually uncommon.
In Wall Street parlance, it "broke the buck," a rare occurrence.
Unlike the Primary fund, however, those funds have not broken the buck.
If a fund broke the buck and was liquidated, shareholders were supposed to receive $1 a share within 30 days.
With investors running for the exits, the Reserve Primary fund reported that it broke the buck the next day.
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