IMF warns funds holding illiquid assets risk undermining financial stability

Valeria Martinez
clock • 2 min read

The International Monetary Fund has warned that an investor run from daily-dealing open-ended funds with hard-to-sell assets in periods of market stress could threaten global financial stability. The international body singled out less frequently traded securities such as corporate bonds, certain emerging market assets and real estate as posing the most risk in a sudden surge of significant outflows sparked by market volatility.  In a blog post, the IMF wrote on Tuesday (4 October) that in a period of heavy outflows, a "liquidity mismatch" might be a major issue for fund managers. ...

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