Investcorp has introduced a new fund of hedge funds to meet client demand for product that targets returns comparable to those achieved by equity investments.
Leveraged DSF has as its base Investcorp's successful flagship fund of hedge funds product, Diversified Strategies Fund (DSF), but uses leverage to increase the risk and return profile. The proven DSF has achieved annualized returns of 7.7% since its launch in 1996. Using simulated data, Investcorp has estimated that Leveraged DSF would have achieved an annualized 16.3% return over the same period. Looking at equity performance, the S&P 500 index of US equities has provided an annualized return of 7.98% since 1996, but with considerably higher risk.
For Leveraged DSF, Investcorp's expert team has selected over 40 'best in class' managers, each diversified in investment strategy and style.
Gary Long, Investcorp' s Chief Operating Officer, said: 'Investcorp's hedge funds program is now in its ninth year. In that time it has outperformed benchmarks and proved itself in all market environments and we now have a long and substantial track record in this asset class. This is underpinned by our 35-strong investment team, which has experience in multiple asset classes from world-class institutions, as well as complementary skills in trading, risk management, portfolio management and operations."
Long added: "Our clients recognize that funds of hedge funds sit alongside other alternative investments, such as private equity, venture capital and real estate, in a diversified portfolio. Globally, institutions and sophisticated individual investors are allocating a greater percentage of their portfolios to alternative investments, and Investcorp is responding to client demand."
Leveraged DSF is the eighth fund of hedge fund product from Investcorp, which has over USD 3.2 billion of assets under management in its program. Of this, some USD 1.4 billion is Investcorp's own capital. The size of this proprietary investment results in a strong alignment of Investcorp's interests with those of its clients.