FTAdviser.com

Advertising

Pioneer Alternative Investments has launched its second Ucits III cash-plus fund aimed at the retail market.

PAI Absolute Return Asian Equity follows the €236m (£187m) PAI Absolute Return Equity fund, and will look to provide long/short exposure to Chinese and south Asian shares.

As with its first offering, PAI has teamed up with Luxembourg-based firm Structured Invest SA.

Principal fund manager Manuele Moi and deputy fund manager Adrian Doyle will aim to deliver positive returns across all stages of the economic cycle, with low market correlation. They will use a fundamental bottom-up approach informed by thematics rather than relying on quantitative analysis.

Alberto La Rocca, chief executive of PAI, said: "This innovative approach of making a true absolute return strategy available within the well-regulated Ucits III framework is a move which will only grow in popularity with all types of investors as the demand for outcome-orientated solutions increases."

He added: "I see further opportunities for us to offer long/short capabilities in this type of vehicle, as well as the more traditional hedge fund structure."

Luca Mengoni, chief investment officer at PAI, said the use of derivatives to take short positions alongside traditional long holdings was the optimal strategy to extract returns from Asia.

"Asia remains an impressive growth story but with some cyclicality and diversity of returns across the various markets," he said.

Despite its size, PAI Absolute Return Equity – the hedge fund house's first venture into the Ucits III space – was launched in November last year.

At the time, Mr La Rocca said PAI's experience in running institutional hedge strategies would be an advantage in making full use of the Ucits III powers, and said its fund managers' tendency to shy away from quant screens would help navigate unpredictable market conditions.

The existing Absolute Return Equity fund makes extensive use of shorting, with 12.7 per cent short exposure to retail stocks, 12 per cent short exposure to food and beverage stocks and 9 per cent short exposure to media shares. From launch to the end of March it has returned a flat zero, while the MSCI World and Europe equity indices have both fallen.

The new Absolute Return Asian Equity fund is domiciled in Luxembourg, although PAI is in the process of securing distributor status in a variety of European countries, including the UK.

The retail share class carries a minimum investment of €5000 or the dollar equivalent.