Yes; a managed account program can sometimes close to new investors. There are various reasons this may happen, but when it does, new investors are not allowed to open accounts and existing clients may not be allowed to make additional deposits.
Reason Why a Program May Close
Here are some reasons why a managed program may close to new investors:
Asset Saturation Point is Reached – This happens when the level of assets invested in the program reach a level that makes it more difficult for the portfolio manager to continue to trade with the same methodology or strategy. Sometimes, this happens when the manager uses shorter term trading strategies that may be more heavily dependent on market liquidity. A simple example will illustrate this point better. Let's say that a forex money manager is trying to buy 200 standard lots of EURUSD for the managed account and only 100 are available at the best price. This means that the manager will get a better price on the first 100 lots and a higher or worse price on the remaining 100. The greater the portion of the order executed at a worse price is, the lower the overall profitability will be. This problem is more prevalent when dealing with larger managed accounts (since larger orders will be required) that are more actively traded.
Manager Leaves, Retires, or Dies - If a managed program is traded by only one money manager and that manager leaves the program, it is possible that the program may close; especially if a suitable manager is not found as a replacement. The same is true if a manager retires, leaves to another firm, or (God forbid) passes away or suffers a serious medical issue that prevents the manager from proceeding with his investment management duties.
Unforeseen Event - No one knows what the future holds, especially in the chaotic world we live in. That's why, a managed account program may also close due to some unexpected event; for example, a bankruptcy of a brokerage firm or bank where the accounts are traded (that is why it is so important to invest with a firm that offers a high degree of safety of client funds – read, "Is Your Forex Account Really Safe?").