The Ei-3 Top Performers Index is a new, investable hedge fund benchmark designed to reflect alternative and diversified hedge fund strategies from the universe of hedge funds represented on the Exante platform.
The Ei3 Top Performance Index provides investors exposure to a diversified, AUM-weighted composite of innovative and consistently high performing hedge funds.
The Ei-3 Top Performers Index returned 25.28 per cent in 2013, outperforming HFR Global (6.72 per cent), Eurekahedge Absolute Return (11.19 per cent), Barclay Hedge Fund Index (11.16 per cent), Bloomberg Hedge Funds Aggregate (7.4 per cent), BTOP50 (0.72 per cent), and MSCI World (24.10 per cent).
The component funds of the Ei-3 Top Performers Index are quantitatively selected, based almost exclusively on performance, from a breadth of strategies which include over 150 funds. The universe includes a wide range of sectors and strategies without constraint as to the geography, size, and philosophy. Included in the index at launch are multi-arbitrage, high frequency trading, long/short equity real estate, currency, commodity, fixed-income and volatility strategies. It is well diversified not only in terms of fund strategy, but also in respect of geographical location.
Tim Enneking, a partner at Exante, says: “the Ei-3 Top Performers index is a testament to the maturing Exante business in attracting outstanding hedge funds into a trading environment which captures the best of technology, investment management, and hedge managers. The performance of the Ei-3 Top Performers Index is due to our fund clients and their ability to deliver high returns to investors in these challenging markets.”
The Ei-3 Top Performance Index is dollar based, unleveraged and AUM weighted. Investment in the Ei-3 Top Performance Index will be made through a five-year certificate; its performance will reflect the performance of the underlying funds, less distributed income to investors. In response to the growing demand for yield from hedge fund investors, the Ei-3 Top Performance Index will pay a semi-annual dividend of 50 per cent of any gains. The balance will accumulate and be paid as a balloon payment at the end of five years.
David Barclay-Miller, head of distribution for Iconic Funds, says: “The demand for yield continues unabated. The outstanding performance of the Ei-3 Top Performance Index is a perfect opportunity to combine alternative investment strategies with consistent dividend yield. We are delighted to be associated with this initiative which answers many of the demands of today’s investors.”
A secondary market for the notes will be provided on the Exante hedge fund platform. The secondary market liquidity and regular income features will transform the index into a core investment for hedge fund investors as well as traditional dividend seeking investors.
