fund going into soft closure, whats the implications?


Junior member
45 0
Hi sorry if this in wrong place it seemed the best place for this. I am a amateur investor and I have some funds and shares invested with Barclays and Hargreaves Lansdown. One fund I happen to have in both accounts is Cazenove UK Smaller Companies Class B Accumulation, it has done quite well but today I received a message from Barclays so I am assuming I will shortly receive the same sort of thing from Hargreaves Lansdown but I understand the message more or less but what I don't know is what effect this is likely to have on the price, i.e., its still going to be running and has a good track record but will this information have any positive or negative effect, what is the most likely effect of this news?

Here is the email I recieved:-

Dear Client,

We are writing to let you know about important changes affecting a fund that you may hold on our Funds Market.

What is happening?

The Fund Managers of the Cazenove UK Smaller Companies fund have decided to put the fund into 'soft closure' as of 22 January 2014. We will not be able to accept any investments after 10am on that day.

What is meant by 'soft closure'?
Soft closure is a state that Fund Managers apply to their funds when they decide that they have grown too large and they need to have better control over their ongoing growth
It means that the Fund Manager is either closing the fund to further investments or making a charge on investments, as a means of trying to reduce the amount being bought
It does not mean that the fund is being liquidated or closed down. Your assets remain fully invested.
What does this mean for you if you hold this fund?
It means that you will no longer be able to make further investments into the fund
You can continue to hold the fund in your portfolio for as long as you choose
The Fund Manager will carry on managing the fund and you will still be able see it in your portfolio
The fund will continue to be priced and valued on a daily basis
You can sell either all or part of your holdings in the fund as normal.
What do you need to do next?

There is nothing that you need to do, however, you should be aware that:
The fund will no longer be included on our Funds Market and will not be available for dealing online, so please call us to place any deal instructions
If your account charges are currently waived due to holding only funds from our Funds Market this will be unaffected by this change
If the closure of this fund means that you need to find a new fund for future investments then our funds research centre and fund factsheet search are tools available to point you in the right direction.

Can anybody give me some idea what to expect, should I be getting out of this or stay put.

Any advice or help appreciated.
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