Money Market Fund Commentary (Government Securities Money Market Fund & U.S. Treasury Fund)

3Q 2023

Market overview

The overall environment for the money market fund industry was quite benign. In fact, U.S. money market fund assets reached an all-time high of $6.007 trillion as of August 31, according to Money Fund Intelligence. For the 12 months ended August 31, the industry enjoyed growth of $965.4 billion, or 19.1%. This growth was driven by the high returns available in the money fund sector.

Year-to-date, Money Fund Intelligence reported money market fund assets rocketed higher, climbing to $6.1 trillion as of October 3, 2023. Assets this year rose $922.5 billion, or 18.3%. Yields have now climbed above 5% for the first time since before the 2008 financial crisis, as reported by Bloomberg.

Positioning the Money Market Funds

Portfolio composition is subject to change.

The federal funds futures market indicates the Federal Reserve Open Market Committee (the FOMC) is close to the end of its tightening campaign, and we agree. However, we believe that rates will remain elevated for some time to come. The challenge in managing the portfolios will be to maintain the optimal blend of maturities and security types to be able to exploit the opportunities the markets present. To that end, we have a sizable portion of our money market funds in overnight repurchase agreements (repos), which offer daily liquidity and very competitive overnight yields. We have also taken positions in Treasury bills in both the U.S. Treasury fund and the Government Securities Money Market Fund and, in the Government Securities Fund, slightly longer-term agency bonds and agency floating rate notes.

Why should investors consider investing in this Fund?

Money market fund rates are at highs not seen in many years. At current levels, they are competitive with many other asset classes. With daily liquidity and historically stable asset values, we believe they are a time-tested and valued addition to many portfolios.


An investor should consider a fund’s investment objectives, risks and charges and expenses carefully before investing or sending money This and other important information about an investment company can be found in the fund’s prospectus. To obtain a Cavanal Hill Funds prospectus or summary prospectus, please call 800-762-7085 or visit us at Please read it carefully before investing.

Cavanal Hill Investment Management, Inc. is an SEC registered investment adviser and a wholly-owned subsidiary of BOK Financial Corporation, a financial holding company (“BOKF”). BOKF, NA serves as the custodian for the Cavanal Hill Funds. Cavanal Hill Investment Management, Inc. provides investment advice, administration and other services for the Funds and receives a fee for providing such services as fully described in the prospectus. The Funds are distributed by Cavanal Hill Distributors, Inc. a registered Broker/Dealer, member FINRA and wholly-owned subsidiary of BOKF.

You could lose money by investing in the Fund. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The Fund’s sponsor has no legal obligation to provide financial support to the Fund, and you should not expect that the sponsor will provide financial support to the Fund at any time.

Commentary provided is for the indicated period and is designed to provide a frame of reference. It does not constitute investment advice. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. The opinions expressed herein reflect the judgment of the authors at this date and are subject to change without notice and are not a complete analysis of any sector, industry or security. This document contains forward-looking statements that are based on management’s beliefs, assumptions, current expectations, estimates and projections about the Cavanal Hill Funds, the securities and credit markets and the economy in general. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “plans,” “projects,” variations of such words and similar expressions are intended to identify such forward-looking statements. Management judgments relating to and discussion of the value and potential future value or performance of any security, group of securities, type of security or market segment involve judgments as to expected events are inherently forward-looking statements. Management judgments relating to and discussion of the value and potential future value or performance of any security, group of securities, type of security, group of securities, type of security or market segment involve certain risks, uncertainties and assumptions that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what is expressed, implied, or forecasted in such forward-looking statements. The potential realization of these forward-looking statements is subject to a number of limitations and risks, which are described in the Fund’s prospectuses, and investors or potential investors, are cautioned to review the Funds’ prospectuses and the description of such risks. Neither the Funds nor the Funds’ investment adviser, Cavanal Hill, undertake any obligation to update, amend, or clarify forward-looking statement, whether as a result of new information, future events or otherwise.

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