Why has New Star Asset Management suspended dealing in the New Star International Property Fund?
New Star has suspended dealing in the New Star International Property Fund to restore liquidity, following some recent large-scale redemptions from that fund. 2. Can New Star do this? Yes. New Star have kept the FSA informed of their actions and in accordance with rules set out by the FSA, dealing will initially be suspended for 28 days. Given the illiquid nature of this asset class, an application has been submitted by New Star to the FSA in order to extend this period of suspension beyond the 28 day maximum if required. 3. Why have there been so many redemptions from the fund? New Star have commented “The impact of the credit crunch, its knock-on effect on global stockmarkets and investor confidence has resulted in a substantial increase in redemptions from investors – particularly since the beginning of October. In the days running up to 25th November 2008, a few large redemptions have rapidly used up the fund’s liquidity buffer”. 4. Update: Suspension extended – When will the fund
