It is interesting to consider why a sponsor chooses to support a MMMF even though it is not contractually required to do so. Fund sponsors may be concerned about their reputation in the market place, loss of cross-selling opportunities, or the cost of potential investor lawsuits. 21 We posit that fund sponsors may also choose to provide support because they initially underestimate the amount of support necessary to fully alleviate financial concerns in the funds. While the entirety of support is costly, the incremental cost at each point may appear worthwhile. .
