House Prices

Retail investors urge caution in debt product investment

Retail investors should take "extreme caution" in investing in debt products as the financial environment turns against them, investment researchers say.

Tuesday, October 19th 2004

New Zealanders have up to $25 billion in fixed-income investments - spread between finance companies ($12 billion to $14 billion), mortgage funds ($4 billion), hybrid debt investments offered mainly by brokers ($500 million), and corporate bonds ($6.5 billion).

The top of the interest rate cycle and an expected deterioration in business conditions have prompted researcher FundSource to speak out.

"We would like to express concern and urge extreme caution," said FundSource business manager Tim Anderson.

"We're carefully monitoring the situation and our concern is heightening.

"Money continues to flow into these debt investments and we feel there is a lack of understanding of the investments and the risks involved."

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Heartland Bank - Online 6.69
SBS FirstHome Combo 6.74
Wairarapa Building Society 6.95
Unity 6.99
Co-operative Bank - First Home Special 7.04
ICBC 7.05
China Construction Bank 7.09
BNZ - Classic 7.24
ASB Bank 7.24
ANZ Special 7.24
TSB Special 7.24
Unity First Home Buyer special 6.45
Heartland Bank - Online 6.45
SBS Bank Special 6.69
TSB Special 6.75
Westpac Special 6.75
China Construction Bank 6.75
ICBC 6.75
AIA - Go Home Loans 6.75
ASB Bank 6.75
Unity 6.79
Co-operative Bank - Owner Occ 6.79
SBS Bank Special 6.19
ASB Bank 6.39
Westpac Special 6.39
AIA - Go Home Loans 6.39
China Construction Bank 6.40
ICBC 6.49
Kiwibank Special 6.55
BNZ - Classic 6.55
Co-operative Bank - Owner Occ 6.55
TSB Special 6.59
SBS Bank 6.79
SBS FirstHome Combo 6.19
AIA - Back My Build 6.19
ANZ Blueprint to Build 7.39
Credit Union Auckland 7.70
ICBC 7.85
Heartland Bank - Online 7.99
Pepper Money Essential 8.29
Co-operative Bank - Owner Occ 8.40
Co-operative Bank - Standard 8.40
First Credit Union Standard 8.50
Kiwibank 8.50

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