How will PMB Investment manage market liquidity and redemptions?

Question

Accepted Answer

PMB Investment's Strategy for Managing Market Liquidity and Redemptions

PMB Investment is confident in achieving its RM2 billion assets under management (AUM) target by the end of 2020, despite experiencing high redemptions in recent months. The company plans to manage these redemptions and leverage market liquidity through robust risk management practices and by encouraging reinvestment during market downturns. As of June 2020, PMB Investment managed RM1.33 billion in AUM across 16 funds, with a projected 15 per cent increase attributed to high market liquidity stemming from a low-interest rate environment.
Risk Management and Reinvestment Incentives

PMB Investment aims to control redemptions by implementing strong risk management protocols. While the specific details of their risk management strategies for managing redemptions are not elaborated upon, the company's intention is to encourage investors to reinvest their funds when market prices are low. This approach seeks to mitigate the impact of withdrawals by fostering a strategy of buying opportunities during periods of market decline.
Impact of Low Interest Rates on Market Liquidity

The current market conditions are characterised by a low-interest rate regime, which has led to increased liquidity. This high liquidity has contributed to a significant rise in AUM for PMB Investment, approximately 15 per cent over recent months. However, this environment has also resulted in a concurrent increase in redemptions, as investors sought to capitalise on the good returns offered by the company's funds.
Future Fund Launches and Market Outlook

Looking ahead, PMB Investment plans to launch a new milestone fund with unique features by the end of the year, pending approval from the Securities Commission. The company also has ambitions to list an exchange-traded fund (ETF) in the US by the first quarter of the following year, recognising the potential in global markets despite the nascent stage of ETFs in the Malaysian region. The company's chief investment officer anticipates market consolidation in the third quarter of 2020, followed by a stronger performance in the fourth quarter and into 2021, supported by projected global GDP growth and the continuation of low interest rates.

Reading history

Hide →

This history is cleared when the page is closed.

How will PMB Investment manage market liquidity and redemptions?

Loading

Was this article helpful?

Helpful

Not helpful

Report an issue

1

0

0

Share with friends