Merchant Capital, a Ucits umbrella provider to the hedge fund industry, is launching the third fund on its platform – the Merchant Global Resources Ucits Fund.
The fund will employ an absolute return equity strategy with a long-biased approach to investing in global resources.
It has targeted a launch date in October with approximately USD15m in assets under management. Initial capital has been raised from a combination of European institutional and private investors.
Tal Lomnitzer will manage the fund, advised by Mark Latham at Commodity Intelligence. Lomnitzer has 12 years’ buy-side experience in global resources, including three years at the ORN Capital Global Resources Fund, returning 46.6 per cent over that period. He has also managed funds for Deutsche Asset Management and most recently for NewSmith.
Latham, who founded Commodity Intelligence in 2008, for four years managed a global long/short strategy for Odey Asset Management. Most notably he managed the Baring Natural Resource Fund for five years between 1995 and 2000, returning 20.4 per cent.
The strategy combines a top-down thematic approach with in-depth bottom-up valuation work in order to choose the 100 to 150 stocks the fund will be invested in at any one time. Investments are sector-focused, concentrating on global energy, mining, precious metals and agriculture, principally through equities but also derivative instruments and debt.
The fund is targeting European-based investors from a wide base, including IFAs, retail distribution channels, family offices, pension funds, funds of hedge funds, private clients and high net worth individuals.
George Cadbury, co-founder of Merchant’s Ucits umbrella, says: “We are delighted to be launching the Merchant Global Resources Fund. This strategy is a perfect fit for a Ucits fund and will be attractive to investors because of the manager’s track record and the transparent nature of the fund structure. Commodity Intelligence’s level of experience and success is indicative of the type of markets we are targeting.”
Lomnitzer adds: “With the industrialisation and urbanisation of emerging economies we believe that the global economy has entered a ‘supercycle’ for commodities, therefore, this is a great time to launch a resources-focused strategy. A fund of this nature within the Ucits structure provided by Merchant Capital will be very well received by investors who want exposure to the resources sector with controlled volatility.”
BNY Mellon International Bank will be the fund’s administration, custodial and trustee services provider.
