Eddington Capital Management says UK-listed note providing impressive returns

The UK-listed note launched by Eddington Capital Management last April to offer investors an alternative structure to its listed fund of hedge funds is outperforming its peer group, according to the firm’s management, who are about to undertake a new fundraising drive among UK investors.

‘The Nomura Eddington Note provides UK investors easy access to Eddington’s high return target fund range in a convenient and tax-efficient way,’ says the firm’s co-founder and chief investment officer Alex Allen.

‘The disappointing performance of closed end funds and their exposure to discount problems has highlighted the strength of using a note structure for our high return target investment opportunity.’

The note, issued by structured product specialist Nomura International, offers returns directly linked to the performance of the Eddington funds of hedge funds.

The note currently comprises an 80/20 split between the flagship diversified multistrategy Eddington Triple Alpha Fund and the macro focused Eddington Macro Opportunities Fund.

The actively managed balance between the two has the medium term objective of delivering 15 to 20 per cent per annum with moderate levels of volatility.

The structure of the note was specifically designed to be eligible for capital gains tax treatment in the UK. It has already attracted a number of investors, including Caledonia Investments, the UK investment trust company that is a 50 per cent shareholder in Eddington, alongside the firm’s management, Glenn Baggley and Allen.

‘At Caledonia we are known for the quality of the funds and managers that we choose to work with,’ says the company’s chief executive Tim Ingram. ‘Eddington has produced some of the best performing fund of funds in the world, and in conditions of such economic adversity the performance and simplicity of the Nomura Eddington Note speaks for itself.’