In August 2007 the Reserve Primary Fund had been under intense competitive pressure. To improve its yield and attract more investors it had committed 60 percent of its funds to buying ABCP just as other investors pulled out.26 The high yields on offer from desperate borrowers catapulted the fund from the bottom 20 percent to the top 10 percent in the performance league and doubled its assets under management in a single year. But it also exposed its investors to serious risks.
