Amaranth Advisors, the US hedge fund which lost over $6bn, is in talks with its investors over their future investment in its funds and is deciding whether to apply a cap on investors redeeming their money.

Amaranth, whose founder Nick Maounis told investors last week that he hoped to stay in business, currently applies a two-year lock-up to its investors. However, it also has a clause which would allow it to limit any redemptions to a total of 7.5% of the assets in the fund in any single quarter. Until now, it has not had to consider invoking this cap and Amaranth has not yet decided whether to apply this clause to its remaining investors in the light of the requests for redemptions that it has received in the past week.