Armstrong Investment Managers has invested into the newly launched sterling share class of the Swiss & Global JB Absolute Return Europe Equity Fund, managed by Andy Kastner, through its flagship IM Distinction Diversified Real Return Fund.
The Julius Baer Absolute Return Europe Equity Fund has delivered strong performance since it was launched at the end of September 2010. The fund has generated a return since inception of +9.9% (as of 31 December 2011) outperforming its benchmark while harnessing lower volatility compared to European markets.
The fund pursues a market-neutral long-short pair-trading strategy. Using a multi-tier process, the team led by fund manager Andy Kastner selects around 25 to 40 pairs, combining a stock that appears attractive (long position) with an unattractive stock (short position) from the same sector. Both positions are always equally weighted, thus achieving a market-neutral and sector-neutral stance. This allows the JB Absolute Return Europe Equity Fund to generate a positive return irrespective of the market developments, and even if both prices fall – provided the long positions outperform the corresponding short positions.
Keith Rumbelow, Head of UK Sales, Swiss & Global Asset Management, says: “The sterling share class is an important step in providing UK investors’ access to our outperforming JB Absolute Return Europe Equity Fund. The fund has been able to deliver strong performance and notably low volatility despite the tough economic backdrop. The investment in the new sterling share class from Armstrong Investment Managers is testament to the success of Andy’s investment approach and increased demand for this product.”
James de Bunsen (pictured), Portfolio Manager, Armstrong Investment Managers, says: "We like the JB Absolute Return Europe Equity Fund for a number of reasons, chiefly its disciplined focus on achieving beta-adjusted market and sector neutrality. There are too many funds in the long/short equity universe that simply provide investors with a low beta exposure to equities at a high cost, without adding any true diversification benefits. Lead portfolio manager Andy Kastner has extensive experience running market-neutral strategies and combines a strong research capability with a very robust risk management process. This approach allows the team to show conviction in their pair trades, thereby generating attractive returns, while controlling overall portfolio volatility.
“We are adding the JB Absolute Return Europe Equity Fund fund in the first instance to our flagship retail fund, the IM Distinction Diversified Real Return Fund, which has just celebrated its second anniversary in the top decile of its peer group, the IMA Mixed Investment 20-60% Shares."
