InvestorQ : Why Franklin Templeton has announced winding up of its schemes?
vaishnavi mhatre made post

Why Franklin Templeton has announced winding up of its schemes?

Answer
user profile image
ramya Bhaskaran answered.
6 months ago


As per the words from the President of the company, significantly reduced liquidity in the Indian bonds market for most of the debt securities and unpredictable redemptions of the scheme due to the outbreak of COVID-19 has compelled the company to take that decision.

The company is not able to sell its investment in the market since there are no buyers due to the COVID-19 outbreak. Most of the investors in the market have become risk-averse and they are not willing to buy under-rated or lower-rated papers. Also, the fund is not able to sell any of its investments to meet the redemption pressure created in the company and hence no there’s a big liquidity crunch.