Paul Tudor Jones, one of the most successful hedge fund managers of the past two decades, suspended withdrawals from his flagship fund yesterday.

He told clients, who include Sir Jackie Stewart, the former Formula One motor racing world champion, that he is splitting the $10 billion (£6.7 billion) Tudor BVI Global Fund. Clients will have their money divided between that fund and a new one called Legacy, which will contain illiquid investments such as corporate bonds and emerging market debt.

Investors will be allowed to get their money out from March, once the harder-to-sell investments have been hived off into Legacy, and they will not be charged a performance fee until its assets have exceeded their peak value.

The move comes after requests from investors for $1.4 billion of their money back. It has shocked the hedge fund industry as the BVI Global Fund, which has achieved annual returns of about 22 per cent since launching in 1986, is down only 5 per cent this year - far outperforming its peers.

In a letter to clients, Mr Tudor Jones wrote: “I recognise that a restructuring is an unwelcome but I believe necessary step against the backdrop of Tudor BVI's 22-year history of unbroken profitable years. I believe it is but a brief step, however, on the road to important long-term changes for the benefit of all investors.”

Mr Tudor Jones's move comes after similar measures last week by two of the biggest names in London's hedge fund industry. London Diversified Fund Management, headed by Robert Standing and David Gorton, suspended redemptions on two of its main hedge funds, which were, until the middle of the year, said to be worth $5.2 billion. CQS, headed by Michael Hintze - the hedge fund tycoon whose 55th birthday party on Friday night was attended by the Prince of Wales - has also contacted investors in two of its biggest funds to sound them out on limiting withdrawals.

Mr Tudor Jones, 54, is worth an estimated $3.3 billion. He was born in Tennessee and owns a 346,000-acre safari park in Zimbabwe. His UK headquarters are at Great Burgh House, a Grade II-listed mansion on the Epsom Downs with its own cricket pitch.

Times Recommends

• Gazprom brands Ukraine 'a barbarian' in gas row
• Services sector raises fears over UK jobless
• Retailers surge as profits survive sales plunge