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FEDS Note: Liquidity Transformation Risks in U.S. Bank Loan and High-Yield Mutual Funds: A 2026 Update

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Kenechukwu Anadu, Sean Baker, Fang Cai , Logan George, and Erik Larsson Mutual funds (MFs) and other open-ended collective investment funds engage in liquidity transformation—they offer investors daily redemptions while investing in assets…

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