Société Générale Securities Services (SGSS) announced at this week’s Fund Forum International the launch of a turnkey solution to enable asset management companies and independent managers to create, manage and promote Ucits funds. SSGS said that the solution was aimed at global managers who don’t want to create a Ucits-registered asset management firm, instead providing them with a Luxembourg legal structure that fulfills EU regulations. The turnkey solution allows managers to create and distribute Ucits funds across all 27 members of the EU as well as offer distribution advantages in non-EU jurisdictions.
Olivier Renault, deputy chief executive and Luxembourg country manager for SSGS said that whilst many asset managers worldwide recognized the benefits of setting up a Ucits fund they “don’t necessarily have the time or resources to do so themselves. This one-stop, turnkey solution from SSGS provides our asset manager clients with the Luxembourg-based legal and regulatory framework they need to distribute their own Ucits fun in all the member states of the EU.”
SSGS has drawn on the expertise of Société Générale Private Wealth Management, a Luxembourg-based asset manager that is fully authorised to manage Ucits funds. Clients who choose to use the turnkey solution will also benefit from SSGS as a provider of domiciliation, fund administration, custody and transfer agent services for their funds.
Looking at Ucits fund launches, it has to be said that things have been relatively quiet in June. Two new products were however announced this week. Firstly, Swiss and Global Asset Management is set to become one of the first to launch actively-managed ETFs in Europe with FTAdviser reporting that the asset manager is due to list four Julius Baer Smart ETFs on the Deutsche Boerse in Frankfurt. The listing is expected to commence 29 June 2012. Each ETF, which is UCITS IV-compliant, holds up to 200 positions and is fully invested in equities.
No swaps will be used for synthetic replication. S&G said that the avoidance of securities lending and borrowing would protect investors from issuer or counterparty risk. All four funds carry a management fee of 0.45 per cent. “The aim of our active strategy is to avoid and at the same time exploit the typical human errors in the investment process,” commented Stefan Fröhlich, lead fund manager of the Julius Baer Smart Equity ETFs at Swiss and Global. “These include temporary overreactions and the strong herd instinct of many investors.”
The second launch comes from Nomura who have teamed up with hedge fund firm Permal to bring to market a Japanese equity market neutral fund designed to generate absolute returns with low correlation to major Japanese equity markets. The Ucits-compliant Nomura Permal Alpha Japan Neutral Fund, which officially launched on 8 June 2012, is managed by Seven Seas and is available to investors in USD, EUR and JPY share classes on the Nomura Ucits platform. According to a Nomura press release, Nomura and Permal selected Seven Seas because of its recognized stock picking skills, its stable and mature investment team, and the fact that it receives research and analysis from Alpha Japan Asset Advisors, a Tokyo-based firm.
“Corporate Japan has some great assets offering ample liquidity with more than 3,700 listed stocks,” said Peng Tang, Managing Director of Seven Seas. “It accounts for 68 of the world’s 500 largest brands and corporations, and is home to a very dynamic mid- and small-cap segment. What also makes market neutral long/ short such a suitable investment style for the Japanese market is the well-defined short selling and relative value trade opportunities that are readily available to the investor.”
Roberto Giuffrida, Head of Global Sales at Permal, added that with investors increasingly looking for portfolio diversification “there is a strong interest in high quality regional focused funds”. “Japan is an attractive market for long/short managers and having invested there for many years we know that manager selection and long/short stock picking are the keys to alpha generation in the region,” said Giuffrida. Within Ucits he said there were currently very few Japanese market neutral funds and that the new fund was an “exciting investment proposition for those interested in exposure to Japanese companies while limiting country and macro risks”.
Finally, investment fund software provider Multifonds has launched a new product to allow fund administrators to consolidate their investor servicing and transfer agency operations onto a single platform supporting all investment types. Rebranded as Multifonds Global Investor the platform is an extension of the former Multifonds Transfer Agent platform to fully support alternatives. Apparently five administrator clients of Multifonds have committed to using the new platform, three of which, including European Fund Administration, are already using it to operate both long-only and alternative funds.
Multifonds Global Investor is supporting more than USD1.2trillion in global assets. Fund structures such as limited partnerships, FoFs and alternative UCITS funds, as well as master/feeder structures, money market funds and long-only UCITS funds are all supported.
Oded Weiss, CEO of Multifonds, was quoted as saying: “We are delighted to offer clients a proven, scalable solution for alternative as well as traditional funds. Multifonds Global Investor is the only transfer agency product that can offer a combined long-only and alternatives solution.” Weiss added that by supporting different fund types it enables clients to reduce their cost of ownership and improve operational efficiency.