Funds Hub

Money managers under the microscope

Quicker to get Out of Africa

February 11, 2010

With liquid hedge fund strategies so much in demand, Insparo Asset Management is shortening the redemption terms on its $165 mln Africa & Middle East fund because it ended up buying assets that were more liquid than it had originally expected.

Investors will be able to withdraw up to 25 percent of their cash per quarter, meaning they can fully exit the fund in a year should they wish — surely a welcome move, given it previously took two years.

Nevertheless, as with any hedge fund, it remains to be seen how it would fare should another credit crisis-type scenario occur, when buyers suddenly disappear, even in markets that are normally fairly liquid.

Someone who knows this well is Jamie Allsopp, former manager of New Star’s Heart of Africa fund, who is now in a marketing and investment role at Insparo.

New Star, now part of Henderson, had to suspend Heart of Africa in December 2008, citing difficulties in honouring redemptions. Two months later New Star announced the fund would be wound up completely and the portfolio sold off.

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