Taiwan’s Securities Investment Trust & Consulting Association (SITCA) has advised asset managers to be more disciplined in their pitching of high yield bond funds, reported The Liberty Times.
The advise come as HY bond funds gather an increased presence on the island.
Go deeper with GlobalData
Access deeper industry intelligence
Experience unmatched clarity with a single platform that combines unique data, AI, and human expertise.
The market which generated NT$1 trillion (US$33.3 billion) AUM in total by the end of March 2013, compared to a NT$100 billion in 2009 has urged the regulator to conclude that the market is becoming overly speculative.
SITCA has urged asset managers to strengthen the focus on the products’ high yields in their promotional material with explanations of the potential risks relating to the funds.
SITCA states that the font size of the risk warnings in sales documents should not be excessively small.
As the bonds with credit ratings below BBB called junk bonds fall into the HY bond category, the risk exposure for HY bonds category is high compared to other credits.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalData
