GHF Group says the unit value of its alternative investment fund in the real estate sector has surpassed the 200 per cent mark since January 2010.
The fund yielded a 43 per cent return in 2009, and continued to benefit from low interest rates and a below-value housing market in the US and Europe in 2010.
In spite of slow signs of global economic recovery, the real estate fund is expected to continue outperforming most sectors this year.
The fund invests in US and European capital market instruments ranging from equities, debt and derivatives with returns linked to residential and commercial real estate, using long-short and relative value strategies.
“The relative value method takes advantage of mismatches in prices of securities across markets and long-short strategies profit from both rising and falling prices,” says GHF Group senior real estate analyst Bruce Morton. “Originally this fund was structured to hedge inflation risks. In the second year of the global recession, however, it is now driving the value of most clients’ holdings.”