The issue with the mortgage funds is that following the Government guarantee people are moving money from unguaranteed sources (like the above mortgage funds) to guaranteed areas. The managers (Challenger, Perpetual and AXA - City Pacific is a different kettle of fish) are ensuring that they are not forced to sell assets to meet redemption requests. If they sell assets, it damages all the investor returns (not just the ones trying to pull out).
The Perpetual fund is apparently cashed up (over 40%) but have said they will move to quarterly redemptions to try and settle things down a little and protect investors from themselves (let's face it, mortgage fund returns are better than cash).
The managers are not trying to suspend redemptions from share market based funds - there prices are marked to market and as such is no need to.
The issue with the mortgage funds is that following the...
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7,944.7 |
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