The fate of another fund run by Neil Woodford hangs in the balance after trading was suspended following the disgraced investment guru’s decision to resign as manager.

Shares in the Woodford Income Focus Fund have been suspended from dealing amid a rush to pull out investor money, with administrators now considering all options including possibly winding up the fund.

Link Fund Solutions, which administers the fund, said the move was made to protect investors.

It follows Mr Woodford’s decision late on Tuesday to quit as manager of the fund and close down his investment management business after he was sacked from his flagship £3 billion Woodford Equity Income Fund, which will now be wound up.

The equity income fund had been frozen since June, locking thousands of investors out of their cash and plunging Mr Woodford’s investment empire into crisis.

Link said it is looking at the possibility of appointing an alternative investment manager for the income focus fund, but is also considering winding it up.

In a letter to investors, Link said: “After consideration of all relevant circumstances relating to the fund’s assets, we have come to the conclusion that it is in the best interests of all investors in the fund to suspend the issue, cancellation, sale and redemption of shares in the fund.

“The period of suspension is intended to protect investors from this anticipated increased level of redemptions in the fund.”

It added that as a “forced seller” of its assets, it may not achieve the best value, which could impact on shares for investors remaining in the fund.

“During the fund’s suspension, we will consider the options available to us including the appointment of an alternate investment manager, a scheme of arrangement into another fund or a winding-up of the fund, and decide on the course of action that is in the best interests of all investors,” Link said.

The income focus fund is the smallest of three funds that were run by Woodford Investment Management.

Its sister fund, Woodford Patient Capital trust – a listed business – remains open for trading, but shares have been badly affected and were down another 5% on Wednesday.

The income focus fund, launched in March 2017, has seen its assets under management more than halve over the past six months – down to £258 million from £552.5 million at the end of April.

Most of this has been down to an investor exodus, as well as poor performance.

Its holdings are quoted, which means they are likely to be easier to sell than assets held in the equity income fund, but it does have exposure to medium-sized and smaller companies, which can be hard to sell out of.

The demise of the Woodford equity income fund marked the end of Mr Woodford’s investment management business – and his career as a star stockpicker.

He said on Tuesday he would close down his business, which was founded in 2015 after more than 25 years at Invesco Perpetual.