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Fund Boards Halt Redemptions Spurred by PM Suspension at Swiss Asset Manager

Swiss firm GAM Investments announced in a release that all subscriptions and redemptions in its unconstrained/absolute return bond funds were suspended by the relevant fund boards of directors following a high level of redemptions. The firm said the fund boards are considering all future steps, including fund liquidations, to maximize value and liquidity for clients. According to a Wall Street Journal report, a portfolio manager was suspended after an investigation found flaws in his risk-management and record-keeping procedures. “Following the suspension of Tim Haywood, the ARBF funds have experienced a high level of redemption requests. Although the funds have the necessary liquidity to serve these requests, such actions would lead to a disproportional shift in their portfolio composition, which could compromise the interests of remaining investors,” GAM said in its release. According to a Bloomberg report, analysts are questioning the impact of the redemptions on other bond strategies.