The Financial Conduct Authority (FCA) has proposed steps to address the liquidity mismatch in open-ended investment funds that has led to numerous fund suspensions in recent years, including the implementation of a 180-day notice period for consumers redeeming investments.
Open-ended property funds across the IA Direct Property sector are currently suspended owing to material uncertainty in valuing their assets amid the fallout from the coronavirus pandemic. However, previous waves of suspensions, notably including the one seen in the wake of the 2016 Brexit referendum, were linked to mass redemptions that managers were unable to facilitate as a result of the inherently illiquid nature of the funds' underlying assets. Open-ended funds have been under the scrutiny of the FCA and the Bank of England for some time, with the regulators previously suggesting...
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