Tue, 12/07/2011 - 11:31
Come September, ML Capital’s dedicated Ucits platform, MontLake, is on target to have four funds operating on it, in what is so far turning out to be a good year for the Malta-headquartered firm. It was announced this month that Skyline Capital Management will launch a global l/s emerging market Ucits and follows the earlier announcements of DUNN Capital Management and New York event-driven manager, Para Advisors.
MontLake was launched in Q4 last year specifically to attract hedge fund managers like those listed above. “One of the key drivers of managers coming to us is they can see we have an in-house sales force working exclusively on MontLake. Few independent platforms, if any, can boast of having a dedicated 10-strong sales team. This is one of the platform’s key differentiating factors,” says ML Capital’s CEO and Head of Global Distribution, Cyril Delamare (pictured). As well as managing MontLake, the licenses, and handling compliance and risk management, ML Capital also acts as a fund manager’s distribution arm in Europe.
Delamare is quick to point out the value of this proposition. Notwithstanding the need for state-of-the-art technology and quality staff, just being a platform provider means you quickly become a commodity. “If you want to open up your business, distribution is where you bring in significant revenues and differentiate yourself with unique access to certain clients and demographics,” explains Delamare, who adds: “Distribution is at the heart of launching Ucits funds on MontLake. We’re not looking to be a hotel but a boutique that launches Ucits funds in response to investor demand.”
ML Capital has distribution offices in London and Geneva and operates in a number of core countries including: the UK, Ireland, France, Switzerland and Italy. Given that Ucits has been around a long time, distribution channels are well established. Delamare’s sales team in the UK, for example, targets IFAs, fund platforms and Ucits FoFs where retail investors dominate alternative Ucits.
By comparison, France has few IFAs. Much of the business is done with institutional investors such as pension funds. “It’s a completely different demographic and approach to selling products,” says Delamare. A fund manager that chooses MontLake knows that both sides of the investment market are therefore covered.
The real opportunity and challenge for alternative Ucits funds is to take market share from the well-established and marketed traditional fund houses. Delamare makes the point that the biggest alternative Ucits fund raisings last year were achieved by the behemoth mutual fund groups and not hedge fund groups. Branding is key to this.
Understanding exactly what strategies investors want saw the firm produce a Ucits funds barometer – a quarterly survey – earlier this year. “On the one hand it’s a tool that allows us to keep in contact with investors and on the other hand it’s market intelligence,” explains Delamare.
The same 50 investors representing different demographics investor types and countries take part in the survey. The last survey found that 49 per cent of investors wanted to allocate to US equity l/s managers. This market intelligence is helping ML Capital choose its next wave of fund launches, although Delamare admits that they’ve yet to find the right candidate in the US equity l/s space.
“Ucits now is a structure you need to have if you want to raise assets in certain demographics,” concludes Delamare.
Please click here to download a copy of the Hedgeweek Special Report: Alternative Ucits 2011
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