Due to upcoming regulation, we recently began the process of changing the money market funds (the cash position) in your accounts. These regulations would make most money market funds subject to floating net asset values (NAVs), which could result in taxable gains/losses, and redemption gates, which limit redemptions in a fund for a short period of time.
In order to protect you from both of these things, we have moved your cash position to money market funds and cash deposit types that are not subject to neither floating NAVs nor redemption gates.
All non-natural persons or entity accounts have had their cash position moved to SWGXX, which is the Schwab Government Money Fund. This is the only one that corporate/entity accounts will be able to hold at Schwab, until they eventually make Schwab Bank Deposit available. There will be no floating NAV or redemption gates on this money fund. Click here for the details on SWGXX.
All natural-persons accounts will be moved into Schwab Bank Deposit (SBD or Bank Sweep) early next week. Schwab Bank Deposit is a cash feature that earns interest, is held at Charles Schwab Bank, and is FDIC Insured up to $250,000. This is the default selection for all new natural-persons type accounts moving forward. Click here to download a disclosure on SBD.
You will be receiving notification from Schwab over the next month via email and regular mail. Feel free to reach out to us with any questions or concerns.
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