Many investors in hedge funds last year found it difficult to continue trading after the industry was hit with sudden illiquidity problems. Today, a hedge fund manager is struggling to liquidate itself after it unexpectedly found out it had more assets stuck in illiquid positions than it thought.

Collingham Investment Fund announced at the end of last month that it had decided to shut down its flagship fund of funds because the hedge fund investment climate "has been very difficult over the last two years or so".