Liquidity & Risk Management: Results of a Survey of Large Irish-Domiciled Funds

Pierce Daly and Kitty Moloney
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Pierce Daly: Central Bank of Ireland

Quarterly Bulletin Articles, 2017, 48-62

Abstract: This article examines the liquidity and risk management practices of large Irishdomiciled bond, mixed and money market funds. These funds are an important part of the credit intermediation chain. The 2008 crisis highlights the role of this sector as a transmission mechanism for systemic risk. Consequently, liquidity remains a concern for Central Banks and regulators. We find some evidence that regulation has reduced market liquidity. Considering run-risk, we highlight that large funds generally consist of institutional investors, not retail, and offer daily redemptions. We also analyse the types of liquidity management tools implemented, and find those used are pre-emptive in nature.

Date: 2017-07
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Persistent link: https://EconPapers.repec.org/RePEc:cbi:qtbart:y:2017:m:07:p:48-62

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