Core Viewpoint - Tianhong Fund announced a reduction in the custody fee rate for its Tianhong Yu'ebao money market fund, lowering the annual fee rate from 0.08% to 0.07%, marking the first fee reduction since the fund's inception over 10 years ago [1][9]. Fee Adjustments - The adjusted comprehensive operating fee rate for Tianhong Yu'ebao is now 0.62%, with a management fee of 0.3% and a sales service fee of 0.25% [3]. - Other funds, such as Guoxin Guozheng Cash Growth and E Fund Margin, also announced fee reductions, with total fee reductions of 0.13% and 0.08% respectively [3][10]. Market Context - As of June 30, Tianhong Yu'ebao's scale was 793.219 billion, and prior to the fee reduction, the fund incurred a custody fee of 315 million in the first half of the year [9]. - The reduction in fees is seen as a response to declining yields and regulatory policies, indicating a potential beginning of a fee reform in the money market fund sector [3][11]. Yield Trends - The seven-day annualized yield for Tianhong Yu'ebao has decreased to 1.02%, while other funds like Guoxin Guozheng Cash Growth and E Fund Margin have yields of 0.82% and 1.16% respectively [12]. - Recent data shows that over 10% of money market funds have yields below 1%, with some even below 0.5% [12]. Regulatory Influence - The China Securities Regulatory Commission (CSRC) has encouraged the reduction of management and custody fees for large-scale index and money market funds as part of its initiative for high-quality development in the public fund industry [13]. - The CSRC's recent draft regulations suggest that the sales service fee for money market funds should not exceed 0.15% per year, further supporting the trend of fee reductions [13]. Investor Impact - Lower fees directly reduce investment costs for investors, enhancing actual returns and making money market funds more attractive to low-risk investors [14]. - The fee reductions are expected to drive fund companies to improve management efficiency and research capabilities, ultimately raising the overall professional standards in the public fund industry [14].