A new leveraged fund of hedge funds launched by Key Asset Management in February has already raised USD 50 million in assets under management.
Launched on 1 February 2004, Key Hedge Fund Plus, Inc. offers investors a 2:1 leveraged investment of the fund's assets in Key's flagship fund, Key Hedge Fund, Inc.
Over a fourteen-year track record, Key Hedge Fund, Inc. has achieved an annualised rate of return of 9.4% and generated positive returns every single year.
With a volatility of 1.6%, a return of 8.73% and a Sharpe in excess of 4 in 2003, Key Hedge Fund, Inc. is a low volatility fund of funds with a return/risk profile that is highly suited to a leveraged fund.
Key Hedge Fund Plus, Inc. will utilise a leverage ratio of one part debt for each part equity in Key Hedge Fund, Inc. to achieve its investment objective. Key stated: "An investment in Key Hedge Fund Plus, Inc. will, therefore, be more aggressive than a direct investment in Key Hedge Fund, Inc. offering clients seeking a leveraged complement to their fund of funds investment greater potential for reward".
Thomas Raber, Managing Director of Key Asset Management in London, said: "The launch of Key Hedge Fund Plus, Inc. demonstrates Key Asset Management's ability to structure innovative fund solutions to satisfy investors' demands. Given the current interest rate environment, Key's ability to generate strong returns with low volatility and investors' appetite, we felt the climate was ideal for a leveraged fund of funds."
Key Asset Management, founded in 1989 by Morten Kielland, is an independent hedge fund company specialising in alternative asset management. Key, with offices in London, Oslo, Geneva, Stockholm, and New York, currently has in excess of USD 900 million in assets under management and advice. Key's first fund of hedge funds, Key Hedge Fund, Inc. was launched in April 1990. Since then, Key Asset Management has launched a number of new and innovative funds, including a fund of funds with a capital guarantee, an emerging markets single manager fund and most recently, Key Hedge Fund Plus, Inc.