A problem fund from the now defunct City Financial will shut its doors permanently after being unable to cope with persistent redemptions.
The Garraway Absolute Equity fund was suspended for a second time this year on 25 July after which point it will be liquidated. It was first gated back in early March but resumed trading a month later.
A Garraway spokesperson said the decision to terminate the fund was taken after “very careful consideration” as the fund continued to be plagued by redemptions.
The London boutique acquired the absolute return fund back in late March from City Financial along with £240m worth of UK and Ireland Ucits assets after City went bust.
It said even then the “commercial viability of the fund was already being challenged” by clients pulling money from the fund.
“We have made every effort to keep investors updated throughout and the suspension (and termination) is designed to try to protect them from suffering from increased ongoing charges following redemptions and importantly to ensure an orderly wind-down is possible to allow monies to be returned to them in a controlled fashion,” a Garraway spokesperson said.
“We believe that the suspension of dealing and termination of the fund is in the best interests of investors.”
Garraway Absolute Equity was the worst performing fund of the first half of 2019, beating out Neil Woodford’s troubled equity income fund. It returned -36.93 over the first six months of the year, matching last year’s losses of 37%.
