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Red Kite Hedge Fund Approves Longer Withdrawal Terms

Hedge fund Red Kite, which is down this year after surging 190% in 2006, said on Thursday that investors will now have to give longer notice before pulling their money out.

The roughly $1 billion fund, which specializes in metals trading, said investors overwhelmingly approved its request to extend the period they need to give notice to 45 days before the end of the quarter. It used to be 15 days.

A 45-day notice period is common in the $1.3 trillion hedge fund industry.

"Red Kite believes the approval is a reflection of the confidence that shareholders have in the Fund," the fund wrote in a statement.

The fund last week asked investors to approve an amendment to extend the notice period. On Thursday, the fund, based in London and New York, said the longer notice period makes good sense considering how quickly assets have grown in the fund.

Since the fund began trading in 2005, it has returned 400%, and its size has ballooned to roughly $1 billion from roughly $25 million, people familiar with the fund said.