Most funds hold a percantage in cash for liquidity. If an investor wants to leave the fund, they get paid out of the cash element. It means that the fund manager doesn't have to sell equities every time some wants to leave the fund. It might not be a good time to sell.
Liam D. Ferguson
www.ferga.com
As for investors exiting the fund, the timing of that is a matter for the individuals concerned. If the fund manager has to sell shares at a low price to fulfill their sell orders, that's their problem.
Given the collective nature of a Managed Fund like this, a fund manager cannot simply pass on a loss to an individual investor who happens to want to cash out at an inopportune time. If the fund suffers a loss, all investors are affected.
gonk said:You may have put your finger on it, when you note you don't know the size of the fund. I imagine the smaller the fund, the higher a proportion of the fund would need to be held in cash.
I am told the fund has over 10 million euro. Is this important?