The PCOXX money market fund is the Wealth share class of the Federated Hermes Prime Cash Obligations Fund. It is designed to earn income on short-term cash while seeking a stable $1 share price. It is a mutual fund, however, so its income can change and its principal is not guaranteed.
Before choosing PCOXX, check four things: the latest dated yield, the total costs of your account, the minimum your broker applies, and how quickly you can turn fund shares into spendable cash.
What is PCOXX?
PCOXX is a retail prime money market fund. “Prime” describes the type of short-term investments it can hold; it does not mean the investment is government guaranteed. “Wealth” identifies the share class, which matters because different classes of the same fund can have different expenses and access requirements.
The official Federated Hermes fund page describes its objective as current income with principal stability and liquidity. Its portfolio can include bank and corporate debt as well as government-related investments. It is not a Treasury-only fund.
A money market deposit account is a different product. Our guide to money market funds and bank deposit accounts explains the distinction.
PCOXX fees and minimum investment
The September 30, 2026 summary prospectus lists these figures for Wealth shares:
| Item | Prospectus figure |
|---|---|
| Ticker | PCOXX |
| Annual operating expenses before waivers | 0.24% |
| Annual operating expenses after waivers | 0.20% |
| General minimum initial investment | $500,000 |
| Minimum subsequent investment | None |
| Purchase and deferred sales loads | None |
The general minimum is not necessarily your broker’s minimum. Intermediaries can apply higher or lower requirements, and qualifying pooled accounts can permit smaller underlying accounts. Ask for the requirement for your exact account before transferring money.
A fund with no sales load still has operating expenses. The net figure also reflects waivers that have conditions and a stated term. Check the current prospectus rather than assuming the fee remains unchanged indefinitely.
Check costs outside the fund
Ask whether advisory fees apply to cash invested in PCOXX, whether your platform charges for purchases or sales, and whether account maintenance or transfer fees apply. These can matter even when the fund’s expense ratio looks competitive.
The SEC’s cash sweep investor bulletin explains why investors should compare account costs and available cash options. Also confirm whether buying PCOXX is a manual purchase or part of your account’s automatic sweep arrangement.
How to read the PCOXX yield
A money market fund’s yield changes over time. The SEC’s money market fund overview explains that distributions generally follow short-term interest rates. A quoted yield is not a rate you lock in for a year.
For a current comparison, find the dated 7-day net yield for PCOXX on the official product page. Match the share class and date when comparing it with another fund. Read the disclosure to see whether the number is a simple annualized yield or an effective yield that reflects compounding.
Do not confuse a trailing one-year return with today’s yield. The former describes a completed period; the latter summarizes recent income. Neither promises what you will earn next month.
A hypothetical income example
Suppose a fund earns a constant 4% annualized net rate and your balance stays at $25,000 for a full year. A rough estimate is $1,000 before taxes and separate account charges, without compounding. This is an illustration, not PCOXX’s current yield or a forecast.
If the rate falls to 3% for the entire year, the same simple estimate becomes $750. That $250 difference shows why a cash plan should still work when yields decline.
When comparing fund yields with savings accounts, read how APY differs from a stated interest rate. Comparing numbers with different calculation methods can give a misleading result.
Is PCOXX FDIC insured?
No. PCOXX is a mutual fund rather than an insured bank deposit. The FDIC’s deposit insurance guidance identifies mutual funds as investments it does not insure. Buying the fund through a bank does not turn it into a protected deposit.
For a bank savings account, coverage depends on the institution, ownership category, and applicable limits. For PCOXX, a target $1 share price is an investment objective rather than an insurance promise.
SIPC protection has a different purpose. It can address missing customer securities or cash when a member brokerage fails, subject to its rules. It does not reimburse an investment’s decline in value. The SEC’s SIPC explanation describes that distinction.
Risks to understand before using it for cash
Money market funds generally take less risk than stock funds, but losses remain possible. Issuers and counterparties can fail to meet obligations. A fund’s income can also fall as short-term rates change.
Market stress can affect liquidity. PCOXX’s prospectus permits discretionary liquidity fees in specified circumstances. A routine fee table showing no redemption fee should not be read as a guarantee that a stress-related liquidity fee can never apply.
Inflation creates another risk: your dollar balance may remain steady while its purchasing power shrinks. The SEC’s money market fund risk guide discusses inflation and the possibility of losing value.
PCOXX versus a high-yield savings account
Choose the comparison around the job your cash needs to do. Ask:
- Do I need deposit insurance for this money?
- Can I meet the actual minimum for my account?
- How quickly can I withdraw funds to pay a bill?
- What is the return after separate account charges?
- Will I monitor changes in rates and access terms?
A high-yield savings account may be easier for everyday emergency access. PCOXX may be convenient for eligible investors holding cash in an investment account. Convenience alone does not establish which option is better.
Our comparison of bank money market accounts and high-yield savings helps evaluate deposit alternatives. That comparison concerns bank accounts, not PCOXX.
How to buy and withdraw PCOXX
First, confirm that your brokerage or financial intermediary offers the Wealth share class. Review the current prospectus, eligibility requirements, minimums, and charges. Ask whether distributions will be reinvested or paid to your cash balance.
Before relying on it for a near-term payment, check order cutoffs, business-day processing, and the separate time needed to transfer proceeds to your bank. A completed fund redemption and money available for a debit-card purchase are different milestones.
Taxes on distributions
In a taxable account, fund distributions can create taxable income. Reinvesting a distribution generally does not remove the reporting requirement. Use the classification on your tax statement rather than assuming all fund dividends qualify for a lower rate.
The IRS guidance on dividend distributions explains Form 1099-DIV and reporting. Retirement accounts follow different tax rules; account type matters when comparing after-tax outcomes.
Questions readers ask
Can I buy PCOXX with less than $500,000?
Possibly. The prospectus gives a general minimum, but intermediary arrangements and qualifying account types can change what applies. Confirm your platform’s requirement directly.
Does PCOXX guarantee a $1 share price?
No. It seeks to keep that price stable, but investors can lose money.
Is PCOXX a long-term growth investment?
Its cash-management purpose differs from a growth portfolio. Think about your time horizon before choosing between saving for near-term needs and investing for longer-term goals.
Where should I check today’s yield?
Use the official PCOXX product page and confirm the share class, date, and yield definition. Avoid treating an old screenshot or trailing return as today’s rate.
What to check before deciding
PCOXX is worth researching when you need a cash investment within an eligible account. Compare its dated net yield, separate charges, access rules, and lack of deposit insurance with available alternatives. Keep enough immediately accessible cash for upcoming expenses before moving the rest.
Educational information only. This article is not a personalized investment recommendation. Fund terms and yields can change; review current official documents before investing.