Breaking the Buck

Either successfully riding a bronco until it tires...or a decrease in the net asset value (NAV) of a money market fund to less than $1.00.

For purposes of this definition, let’s focus on the latter. Because money market funds are considered virtually risk-free, and regulations allow managers to hold the value constant at $1.00, a price below this level usually indicates a serious problem in the financial system. Yee-haw.