Providers are backing out of launching absolute return funds, claiming market conditions and the ban on short selling have made conditions unfavourable. Resolution is the latest fund house to admit it will not be proceeding with a launch. It had lined up its European Absolute Return fund to enter the market shortly.
Last Friday, Gartmore revealed that it was shelving plans to launch a similar vehicle. The initial offer period was due to start on Monday October 13, with the launch planned for October 31. A year ago, BlackRock unveiled plans for further Absolute Alpha launches, but there has been no further word. The group maintains that it is still stress testing and that the plans are not at a standstill. The official reasons for the deferment of the Gartmore and Resolution funds are the unprecedented volatility in the markets and the regulator's ban on short selling, but industry commentators have...
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