State Street Global Advisors, the asset management business of State Street Corporationhas launched the State Street Global Alternative Beta Fund, which seeks to approximate the returns of hedge funds as a broad asset class.
The State Street Global Alternative Beta Fund is managed in reference to the HFR’s HFRX Global Hedge Fund Index, which represents a broad range of hedge fund strategies including equity hedge, event driven, macro/commodity trading advisor and relative value arbitrage.
According to a press statement, the new und aims to approximate hedge funds’ beta returns driven, to a large extent, by various market exposures and approximate the risk-return profile of the asset class through a dynamic, factor-based investment process. The strategy aims to determine which market factors have been driving hedge fund returns recently and dynamically replicates those exposures. This strategy increases liquidity relative to directly investing in hedge funds, and by replicating hedge fund beta returns through a systematic process, costs are reduced.
The fund, which is registered in the UK, Ireland, Netherlands, Luxembourg, Sweden, Finland, Norway and Denmark, has been seeded with an initial £123m investment from Quilter Investors.
