New Star has suspended dealing in its £29m Heart of Africa fund following an increase in investor redemptions.
The Jamie Allsopp-managed fund, which had £56m in assets at 31 October, has also been hit by a weakening in sub-Saharan liquidity after market closures in Ghana and Nigeria.
As a result of the dual pressures on the fund, its depositary Royal Bank of Scotland has decided temporarily to suspend dealing in the vehicle until further notice.
Since its launch last November, the fund has fallen 24.4% against an 38.78% decline for the MSCI Emerging Markets Total Return Index.
"Whilst we regret having to take this action, the temporary suspension of dealing is designed to restore sufficient liquidity to the fund for it to meet redemptions once it re-opens for dealing," the New Star statement reads.
"New Star intends to minimise the period of suspension; in accordance with FSA rules this should last for no more than a maximum of 28 days."
The latest development for the troubled asset manager comes under a month after the firm was forced to suspend dealing in its International Property fund following large institutional redemptions.IFAonline
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