Shares in specialist foreign exchange fund manager Record fell heavily yesterday as it revealed that it lost £1.8 billion of assets this week when a large investor withdrew funds because of the sharp moves in global currencies.
Record said the unnamed client had cut its funds by $2.8 billion after the sell-off in stock markets was reflected in big movements in currency pairs.
The group told the stock market that the size of what it described as a “tactical bespoke mandate” would reduce its fee income.
The statement caused its London-listed shares to plunge nearly 14 per cent to 32.04p, valuing the business at just over £70 million.
James Wood-Collins, the chief executive, declined to identify the client. He also refused to go into details about whether the reduction in its fund allocation was because the customer wanted to take profits made from the currency swings, or to cut its losses.
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“This is no great surprise and we have always indicated to the market the nature of this mandate,” Mr Wood- Collins said.
“There is no read across from to our return-seeking strategies or to our hedging activities.”
Record continues to manage a smaller portion of the client’s money, however Mr Wood-Collins said that the withdrawal would lead to a “material” reduction in the company’s fee income, even though the customer accounted for less than 10 per cent of total assets under management.
The announcement came months after Record revealed that the client had handed it an extra $1.75 billion to manage.
It is understood that none of the customer’s cash was held in any of Record’s currency funds and was an execution-only mandate.