Yet another “almost safe” fund loses 50%

A quasi-money-market fund loses 50% of its values. And this one is from BlackRock, a hugely respected asset manager
clipped from online.wsj.com

An institutional cash fund from BlackRock Inc. has been downgraded to “junk” status by Moody’s Investors Service after the fund suspended certain daily fund redemptions — one of the latest signs of an investment fund getting hit because of tight conditions in short-term debt markets.

As many of the securities in the portfolio have become harder to trade, and more redemption requests have come in, BlackRock Cash Strategies Fund has been unable to honor all the redemptions in cash, according to a letter to investors. It has declined to about $1 billion from more than $2 billion at the end of the third quarter.

The move comes as several other fund firms have recently disclosed their own moves to handle similarly pressured short-term investments at money-market and other funds. Such assistance has become increasingly commonplace in recent weeks as fund companies seek to protect these typically conservative offerings.

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