Man Investments, one of the world's largest hedge fund providers, has launched a new capital guaranteed product that invests in an actively managed, concentrated portfolio of sought-after investment managers selected by Man Global Strategies (MGS).
Man MGS Access Ltd, the first in a new product family from MGS, will target substantial capital growth over the medium term.
The product is offered in USD-class bonds and EUR-class bonds providing investment exposure of 150% of net asset value. The bond classes have slightly different targets for medium-term returns but the same volatility targets:
|Bond Class||Target annualised returns||Target annualised volatility|
Investors in both bond classes will benefit from a capital guarantee and a profit lock-in feature. The guarantee, from Credit Suisse International, will ensure they receive USD1/EUR1 for each USD-class bond or EUR-class bond they hold at maturity.
The underlying portfolio currently consists of the 14 MGS hedge fund managers that the MGS Investment Committee rates most highly. Several of these managers were initially seeded by MGS and a number are closed to all other investors. All are accessed through managed accounts which provide MGS with daily position level trading data.
Managers from five investment styles - arbitrage, directional, equity hedge, long/short equities and managed futures -are considered for allocations through MGS' portfolio optimisation process once they attain a threshold rating.
MGS, a core asset manager of Man Investments, is a leading provider of multi-strategy hedge fund portfolios. It aims to secure the best managers in the industry on favourable terms. These include more detailed reporting from managers and, in later years, preferential access to leading managers that are often closed to other investors.
To achieve these special manager relationships, MGS typically invests in early-stage managers, often using its own proprietary capital, and then works closely with managers to help them reach their full potential. Managers are rated according to a range of quantitative and qualitative measures. As their rating improves, MGS will increase the amount of capital it invests with a manager and give them a greater role in its portfolio.
'This is a rare opportunity for private investors to access some of the best hedge fund managers in the industry in an attractive, risk-controlled package that offers the potential for strong capital growth,' said Mike Lozowski, Chief Executive of MGS.