Interest Rates Expectations and Flow Dynamics in High Yield Corporate Debt Mutual funds

Ayelen Banegas and Christopher Finch
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Ayelen Banegas: https://www.federalreserve.gov/econres/ayelen-banegas.htm

No 2022-06-17-2, FEDS Notes from Board of Governors of the Federal Reserve System (U.S.)

Abstract: Fixed-income mutual funds saw massive outflows during the onset of the COVID-19 crisis, with funds investing primarily in high yield debt markets experiencing the largest redemptions, as a percentage of assets. In March 2020 alone, high yield bond (HYB) and bank loan (BL) mutual fund withdrawals reached an estimated 4.1 and 13.6 percent of assets under management (AUM), accounting for close to $10.4 and $11.4 billion, respectively. Following interventions from the Federal Reserve that helped restore credit market conditions and brought U.S. interest rates back to new lows, flow dynamics of HYB and BL funds began to diverge substantially.

Date: 2022-06-17
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgfn:2022-06-17-2

DOI: 10.17016/2380-7172.3115

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