Bank deposit yields favoured
The comparative attractiveness of bank deposit yields was one of the themes of Standard & Poor's (S&P's) Australian fixed interest peer group review.
S&P Fund Services has released its ratings on the 11 funds that make up the cash and cash-enhanced sub-sectors of its review. Ratings of two funds (Goldman Sachs JBWere Cash Trust and Dimensional Short-Term Fixed Interest Trust) were downgraded, while Colonial First State's Wholesale Cash Fund retained its five-star rating.
"A number of key themes were evident during the review, particularly the attractiveness of bank deposit yields when compared with the current returns offered by most cash and cash-enhanced products," said S&P Funds Services analyst Anthony Karaminas. "While the yield on bank deposits is currently being viewed favourably, investors should note this is a changing landscape and both offerings have different features."
Karaminas added that the tight portfolio constraints that were put in place at the lowest point of the downturn in credit markets have softened.
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