Two London-listed hedge fund investment companies advised by HSBC Republic Investments have raised USD58m from institutional and private investors.
Following the placing and offer for subscription assets under management have increased to USD 91m for HSBC European Absolute Limited and USD 113m for HSBC Global Absolute Limited as at 28 June 2006.
Jamie Murray, Global head of marketing, HRIL said: "The Absolute companies have developed a strong institutional following and this latest issue of shares has enabled us to attract new investors into both products. Fund of hedge funds such as European and Global Absolute offer investors diversification from traditional asset classes and the potential to improve the risk/return profile of their portfolio'.
"In light of the volatility in equity markets in 2006, both companies have performed respectably in the period up to the end of May 2006. For the first five months of 2006, the net asset value performance of the Sterling shares of Global Absolute and European Absolute has been 5.2% and 7.5% respectively. This performance complements the robust discount control mechanisms applied across both companies, which have ensured that shareholders have benefited from daily dealing and a share price close to the net asset value of the underlying portfolio of hedge funds'.
"The news that the FSA will be reviewing the availability of funds of hedge funds in the UK market is very positive and may mean yet more interest in these sorts of vehicles. Aside from the existing pools of demand that we and similar product providers have identified, we are also seeing new institutional and private client markets opening for daily dealing hedge fund products of this kind."