US asset manager PIMCO has said it will liquidate its emerging market currency fund after almost $2bn was withdrawn from investors in the first seven months of 2020.
In an SEC filing last week, PIMCO said it would stop selling shares in its Emerging Market Currency and Short-Term Investments fund to new investors and existing shareholders in November before liquidating the mutual fund in January.
PIMCO confirmed the move, telling the Financial Times it "periodically reviews and evaluates its fund offerings to ensure they meet the evolving needs and objectives of our clients".
Investors have withdrawn £1.8bn from the fund, according to Morningstar data cited by the FT, seeing the fund shrink in size from $2.9bn at the end of 2019 to $877m by the end of July.
Bloomberg data showed the fund had over $6bn in assets in 2015.
Meanwhile, the fund's value has fallen by 4.8% year-to-date, underperforming its JPMorgan Emerging Local Markets Index Plus benchmark's 3.6%.
The fund had been particularly hard-hit during the Covid-19 market freefall, with its institutional shares losing 14% between 20 February and 23 March, Morningstar data for the FT showed. That was around five percentage points more than its benchmark.
Morningstar analysts told the publication that the fund had taken large positions in the Brazilian real and South African rand, both of which have slumped to record lows against the dollar, compared to its comparator, alongside off-benchmark bets on the Argentine peso and Egyptian pound.