London asset manager Matrix is withdrawing the money its Bastion product made in funds run by Gottex Fund Management after Gottex suspended redemptions from two of its own products in which Bastion invests. The move marks an escalation in an increasingly uneasy relationships between managers involved in the troubled $1.6bn (€1.2bn) hedge fund industry.

Bridget Guerin, one of the directors on the Matrix Bastion fund of hedge funds, said Matrix's inhouse fund of hedge funds management team, headed by Stewart Ratcliff, would make decisions on how to reallocate the money once Bastion had got it back.