Threadneedle launches multi-asset absolute return fund
Threadneedle opens Luxembourg absolute return fund to UK retail investors.
Threadneedle has launched the Multi Asset Target Alpha fund, to be managed by Toby Nangle and Matthew Cobon.
The Luxembourg-based fund aims to produce “positive returns in all market environments”, Threadneedle said, investing in equities, bonds and currencies as well as derivatives and other funds. It has the ability to ‘short’, betting on the prices of assets falling.
The fund aims to return 5 per cent over cash, measured using the dollar Libor rate, and also targets a volatility of between 6-10 per cent a year.
Mr Nangle, head of multi-asset allocation, said: “Core government bond yields are now so low that there just isn’t enough room for them to fall to offer downside protection to a classic 60 per cent equity and 40 per cent bond asset allocation.
“Portfolios need now to be managed more holistically.”
Mr Cobon, head of interest rates and currency, runs four other absolute return funds including the £430.9m Absolute Return Bond fund.
The fund has a minimum investment of £2,000 and an annual management charge of 1.35 per cent. It also charges an annual performance fee of 15 per cent of any returns above 1.5 per cent over the three-month dollar Libor rate.