Liquidity stress tests of Investment Funds

A key element of risk management in investment funds in ensuring that there is adequate available liquidity to service redemptions. For this reason, the Austrian Financial Market Authority (FMA) conducts liquidity analyses and stress tests on a regular basis, to be able to identify potential risks that may arise from this type of risk at an early stage.

In 2025, the analysis was based on the reported liquidity risk profiles as well as the reported results of three asset side stress scenarios all with a cut-off point of 30.06.2025 of undertaking for collective investment in transferable securities (UCITS) and alternative investment funds (AIFs) managed by Austrian management companies under the Investment Funds Act (InvFG; Investmentfondsgesetz). Two liability side scenarios were also conducted in addition to the asset-side stress scenarios.

The analysis of the liquidity risk profiles shows that the general liquidity position of the funds is currently generally classified as being adequate.

Results of stress scenarios: Number of funds displaying liquidity mismatches in the respective stress scenarios

All the liquidity mismatches that occurred in the stress scenarios, are plausible based on the applied scenarios, the portfolio structure and the invested asset classes. The asset classes  Emerging Market-, High-Yield- and Corporate Bonds and Equities Austria were identified as having potentially higher liquidity risks.

The FMA plans to monitor the risk situation further and repeat the liquidity stress test in a risk-based form on a regular basis.