London-based Threadneedle has launched a new absolute return fund whose mandate will be to focus on European small caps. The Lux-domiciled UCITS III-compliant Threadneedle European Smaller Companies Absolute Alpha fund has been borne out of investor demand according to the firm’s head of distribution, Campbell Fleming, who said: “We have spoken extensively to our clients and they have indicated a great appetite for a product that will capitalise on the European smaller companies investment market in this form.” The new fund, which uses an equity l/s strategy, will be managed by Philip Dicken (pictured) who also manages the Pan European Smaller Companies fund. Dicken was quoted in Citywire Global as saying that with recent market dislocations “still fresh in investors’ minds” the opportunity to add value with high conviction long and short positions “was considerable”. The launch comes after Threadneedle recently took the decision to shutter its Smaller Companies Crescendo hedge fund, seemingly in response to the growing appetite amongst investors for hedge fund-style strategies that offer the reassurance of transparency and liquidity provided by UCITS III. “The introduction of Ucits III regulation has triggered strong growth in the regulated absolute return sector and the migration of hedge fund strategies to the transparent, liquid and highly regulated Ucits market looks likely to continue to drive investor interest,” added Fleming.
