The German finance ministry has announced new laws under which investors in open-ended funds will be bound by a minimum holding period of two years. In addition, they will be subject to notice periods ranging from six months to two years, depending on the investment fund. Funds which opt for shorter notice periods will be required to maintain more short-term liquidity.
The German finance ministry has announced new laws under which investors in open-ended funds will be bound by a minimum holding period of two years. In addition, they will be subject to notice periods ranging from six months to two years, depending on the investment fund. Funds which opt for shorter notice periods will be required to maintain more short-term liquidity.
The legislation, which would apply to both private and institutional investors, is to be passed by the German cabinet this summer.
A number of Germany's open-ended property funds have imposed new redemption bans in recent months to stem capital outflows as investors with liquidity problems pull out. The sector has been battling with liquidity issues for a over a year as a result of the financial crisis which saw a mass investor exit in late 2008. As a result, many funds froze redemptions. While some have since re-opened, others, including Degi's Europa and International funds, have reclosed.