Tuesday, August 14, 2007

"Investor Fear Has Overtaken Reason" - Sentinel Seeks to Freeze Redemptions

Adding to the subprime problems, Sentinel Management Group, an Illinois money manager has asked for permission from the CFTC to halt investor withdrawals from its 1.6 billon dollars under management. Bloomberg is reporting that the firm's investments include short term commercial paper, investment-grade bonds and Treasury notes, and there was no indication that the subprime issues that have plagued other private funds are affecting Sentinel's investments.

However, according to Bloomberg, Sentinel has stated that "investor fear has overtaken reason" and the firm is concerne that it cannot meet redemption requests without selling securities at deep discounts and the resultant losses to the funds.

Brokers - if you clients are in hedge funds, you need to review those investments and prepare for the inevitable rash of arbitrations. Customers - if you have not already done so, the time is now to review your investments with your financial professional and decide on a course of action.
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