The Traded Life Policies Fund is the result of a restructuring process over the last six months, which Jeremy Leach, chief executive of Managing Partners, said has been a “difficult period” during which the net asset value of the Traded Policies Fund fell by 25% following disposals.
Although not “gated” the new fund has a minimum investment period of five years after which three months’ notice must be given for withdrawals, in order to preserve liquidity.
If investors do wish to redeem before five years, market adjustments will impact on the withdrawal values, while for the Traded Policies Fund investors can remain invested and withdraw as and when the gate is lifted.
Leach said: “We are aware a minority wishes to exit and our announcement today provides them with that opportunity. At a minimum, those who wish to exit can do so after a five-year term without losing value and others could also see some growth.”
The Sterling Growth share class of the Traded Policies Fund has continued to perform well, according to Leach, providing an annual return of 4.21% up to 15 December 2013.
The UK's Financial Services Authority surprised many investors and fund managers in November 2011 when it declared it was planning to ban the marketing of traded life policy investments to retail investors, saying that they were "high-risk" and "toxic".
One of the most high-profile traded life policy funds to have to suspend redemptions in the wake of the FSA action was EEA Fund Management's $995m EEA Life Settlements fund.
Managing Partners imposed a redemption gate on its Traded Policies Fund in April 2013.
