The Neuberger Berman Absolute Return Multi-Manager Fund, which offers investors access to hedge fund managers at lower fees and account minimums, has exceeded USD1bn in assets under management.
Launched on 15 May 2012, the fund is managed by members of the Neuberger Berman hedge fund solutions team, which has significant experience managing fund-of-hedge fund strategies. The team allocates fund assets to multiple hedge fund advisers that employ distinct alternative investment strategies.
The fund is available to retail investors, does not charge performance-based management fees, offers daily liquidity, has lower investment minimums than typical hedge funds and full transparency of portfolio holdings.
The fund delivers true hedge fund strategies with a more attractive fee structure than traditional hedge funds. As is typical for mutual funds that employ alternative strategies, the fund may charge a higher management fee than most traditional long-only mutual funds but the fund does not charge a performance fee at the sub-adviser or overall portfolio level. This fee structure gives investors the opportunity to net more of the returns achieved by the hedge fund sub-advisers.
Investors are gaining exposure to alternative mutual funds directly and through retirement plans. The fund has been adopted by plan sponsors – either directly or through financial advisors. Certain large RIAs working with small to mid-sized plans sponsors have begun to add alternatives mutual funds into their defined contribution plan's investment line-up. Alternative funds can be used as a single investment option for plan participants or as a component within a target date solution.
"We're gratified by the growing investor interest in the Neuberger Berman Absolute Return Multi-Manager Fund and believe alternatives strategies in a mutual fund format will increasingly be embraced by defined contribution plans as they seek to provide a full range of investment solutions to employees saving for retirement," says David Kupperman, co-manager of the fund.