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Regulators Increase Focus on Bond Funds

The SEC has increased its focus on bond funds in the wake of increasing market volatility, according to a report from Bloomberg. The article notes that the agency has “stepped up exams of money managers, while pushing mutual funds to test whether they could satisfy customer redemptions during periods of financial stress.” Regulators also are concerned that investors know that the funds may invest in somewhat illiquid assets and how those investments will be affected by a rise in interest rates, according to the article. The article also notes that the Federal Reserve has also been contacting investment firms based on similar concerns regarding asset prices in stocks, currencies, and commodities.