Merrill dissolves Global Equity Flows Advantage

UK-based Merrill Lynch Investment Managers is in the process of dissolving its Global Equity Flows Advantage Ltd hedge fund. It is expected to return investments to about 15 principal investors within the coming weeks.

MLIM is not closing the portfolio because of performance reasons or revenue MLIM derived from the portfolio but rather because it does not fit in with the five existing funds the alternative asset arm of the group currently manages.

The fund, launched in May 2000, is up by roughly 12% since inception and its net asset value stands at an all-time high, according to Merrill Lynch. An industry source said that at least two people who are connected with the fund are now seeking alternative employment.

It is believed that the closure of the Merrill Lynch Global Equity Flows Advantage fund will not affect the other single strategy hedge funds in MLIM's alternative investment range.

MLIM runs two of its five funds ' the UK Equity Hedge Fund and European Equity Hedge Fund ' out of London. It runs three others out of its office in New York.

The alternative investment division of Merrill Lynch Investment Managers oversees $9bn worldwide.

There have been a series of recent hedge fund closures, especially by smaller asset managers, attributed by some experts to low returns and lack of earnings derived by the management house from the fund.