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Investec to shut short duration EMD fund after major redemptions

Investec to shut short duration EMD fund after major redemptions

Investec Asset Management is set to close its emerging markets short duration debt strategy following a series of large redemptions rendering the Alt Ucits fund unviable.

According to a note seen by Citywire Selector, the Investec GSF Emerging Markets Short Duration fund will be formally closed on March 9, with no new money accepted as of February 13.

The Luxembourg-domiciled fund, which sits in the Alt Ucits – Currency sector, was launched in January 2011 and was initially overseen by Peter Eerdmans, who is Citywire A-rated and head of EMD at Investec.

Eerdmans stepped back from the fund in December 2012 and left the strategy in the hands of Werner Gey van Pittius, who had also been on the fund since inception, and Antoon de Klerk.

According to Lipper data, the fund had $5.5 million in assets under management at the end of January 2017. This is down from a peak of $197.88 million, which was reached in April 2013, but it has steadily declined since this date.

In the shareholder note, Investec said: ‘Following a number of recent large redemptions the net assets of the fund have significantly reduced.

‘Despite on-going investment opportunities, the resulting small size of the fund will prevent the investment manager from being able to manage the fund efficiently. We do not expect this situation to change or the fund to attract significant inflows in the immediate or foreseeable future.’

In a statement to Citywire Selector, a spokesperson for Investec said: 'In order to best serve our clients’ requirements, we constantly review our product range.

'Our priority is to ensure that our funds are aligned with investor requirements and perform at a cost effective level. Because of this, we feel that this strategy is currently subscale and that it is in the interests of shareholders to close it.'

On a three-year basis, the fund lost 11.1% in US dollar terms, while the fund company’s assigned benchmark, the Cust Index JPM ELMI+, fell 7.3% over the same period to the end of January 2017.

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