HSBC has launched a Sterling Class and a Sterling Institutional Class of its HSBC Ucits AdvantEdge fund of hedge funds.
The Sterling classes of the HSBC Ucits AdvantEdge Fund will comply with the new reporting tax regime for offshore funds, allowing UK investors to be taxed at capital gains rather than income tax rates on disposal of their interests.
This makes an investment in the fund attractive to UK investors, especially given that the top income tax rate for individuals goes up to 50 per cent from April 2010 (as compared to the CGT rate of 18 per cent).
The HSBC Ucits AdvantEdge Fund is a new generation fund of hedge funds, designed to enable both retail and institutional investors to participate in the absolute return opportunities offered by current market conditions via a more liquid and regulated vehicle than a traditional fund of hedge funds.
The fund offers weekly liquidity, and complies with the strict Ucits III rules concerning leverage, counterparty risk and investments traded.
The fund’s investment manager is HSBC Alternative Investments, an adviser of funds of hedge funds. All underlying Ucits hedge funds under consideration go through its rigorous quantitative and qualitative investment due diligence process.
The launch of the Sterling classes follows the HSBC Ucits AdvantEdge Fund’s initial launch of four share classes in October 2009: Euro, US Dollar, Euro Institutional, and US Dollar Institutional. These classes are intended to cater for the non-UK market and income is therefore rolled up within these share classes. The fund has already raised USD53m since October 2009.
Chris Allen, chief executive of HSBC Alternative Investments, says: “The Sterling classes will allow UK investors to gain maximum benefit from the opportunities to participate in the hedge fund sector offered by the HSBC Ucits AdvantEdge fund. The hedge fund industry is leaner and fitter as we enter 2010 and as weaker performers continue to withdraw we believe the remaining providers will reap the rewards from their stronger platforms in the coming months.”
