Ant Financial Services Group’s flagship money-market fund, which has drawn investments from more than a third of China’s population, has seen a significant increase in redemptions over the past month.
Investors Pull Cash From China’s Money-Market Behemoth as Yields Tumble
Beijing’s coronavirus-fighting measures push the yield of Ant Financial’s flagship fund to a record low
HONG KONG—China’s biggest money-market fund is experiencing a pickup in withdrawals following a slide in yields, as people take out more cash to spend and invest in other products with higher returns.
Ant Financial Services Group’sflagship money-market fund, which has drawn investments from more than a third of China’s population, has seen a significant increase in redemptions over the past month, according to people familiar with the matter. One of the world’s largest mutual funds, the seven-year-old Tianhong Yu’e Bao fund had 1.26 trillion yuan ($178 billion) in assets under management at the end of March, the most recent data available.
In early June, the fund’s seven-day annualized yield fell below China’s official one-year bank-deposit rate for the first time since June 2013, according to Wind, a data provider. Tianhong Yu’e Bao’s yield was recently 1.4%, versus the 1.5% benchmark deposit rate.