Sydney based investment manager Perpetual has admitted before tax losses of $18 million since July, $5 million of which are unrecoverable.

The losses were made in its Exact Market Cash Fund (EMCF) and were blamed by Perpetual on the continued deterioration of credit markets.

The loss represents 1 per cent of the total fund and is a $13 million increase on the loss it announced at its annual general meeting on October 30.

What is more concerning for investors, however, is that $5 million of that loss is directly attributable to sub-prime investments and cannot be recovered.

"The balance of the losses are  . . . unrealised and relate to the sharp widening of credit spreads across the broader market during November," the company said in a statement to the Australian Securities Exchange.

"With the exception of the sub-prime related securities, Perpetual expects to recover the majority of the unrealised losses as the balance of the securities held in the EMCF mature."

The firm said it would take about one and a half years to recover the money.

Perpetual defended its losses and said volatility in the market underlined the value of its product for investors, whose capital and returns had been "unharmed by the recent market conditions".

It stressed the original portfolio held less than 0.5 per cent of direct exposure to sub-prime and that there were now no further exposures to such securities in the EMCF.

Perpetual's share price fell 1 per cent on the news to $67.62.