Simple FD cable question

So this is a sram FD with gore cables. But given that the FD is being actuated by a bare cable (no housing nearby), what exactly is the purpose of the red rubber cable shroud? Why is it there?

(pic credit: bikeradar)
http://cdn.mos.bikeradar.com/images/news/2014/04/06/1396804663788-1re0ewb91aqhb-670-80.jpg

Your liner should be extending up into that shroud… The older set-ups had a larger liner that fit over the top of the normal liner, so that it slid over it and effectively sealed the whole thing. If you’ve got exposed bare cable, your system isn’t sealed, so you’ll end up with rusted cable under the BB eventually.