London-based GAM is launching new sterling and euro classes for its flagship US$1.9 billion fund of hedge funds, the GAM Diversity fund. Both new classes are listed on the London Stock Exchange.
GAM said the move makes investment in GAM Diversity more attractive to UK and European pension funds wishing to hold sterling and euro denominated investments.
In addition, for UK private investors, the new currency classes are eligible for inclusion within a Self-Invested Personal Pension (SIPP) which may provide the investor with a tax efficient way of accessing a fund of hedge funds.
The listing of GAM Diversity on the London Stock Exchange ensures that the fund is classified as a foreign security. In certain European jurisdictions (e.g. France and Italy), institutions are able to invest in listed securities. The listing of GAM Diversity avoids restrictions placed on institutions investing in unlisted securities.
Jonathan Moseley, Managing Director, Clients, at GAM, said: "Investors are expressing an increasing interest in alternative investments and in particular in funds of hedge funds. GAM Diversity has provided investors with consistent returns and low correlation to equity and bond markets since its launch in 1989. The new sterling and euro classes will be particularly appealing to UK and European pension fund investors."
Managed by David Smith, Chief Investment Director of GAM’s Multi-Manager team, the GAM Diversity fund has produced a compound annual growth rate of 12.96 per cent since its inception in 1989 with an annualised standard deviation of 9.38 per cent versus the MSCI World’s annualised standard deviation of 15.24 per cent.
The fund has posted positive annual returns over the last three years of: 7.04 per cent in 2000; 7.91 per cent in 2001; and 3.42 per cent in 2002. This has been at a time when many pension funds have experienced significant negative returns. GAM Diversity has less than a 0.50 per cent correlation with the MSCI World index,
Background Note: GAM manages US$18.5 billion of clients’ assets of which US$5.0 billion is in discretionary portfolios on behalf of its private clients.
Founded in 1983, GAM employs over 600 people in ten offices, including London, New York, Zurich, Hong Kong, Kuwait, Tokyo and Berlin. GAM is owned by UBS AG.
