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The absolute return craze will not last in the long run, according to Maia Capital, which has just completed a suite of market-neutral investments.

Simon Mungall, partner and portfolio manager at Resolution Asset Management's multi-manager joint venture, acknowledged the boutique was taking a medium-term view with its positions, but warned that the absolute return approach would maintain its current popularity only while markets were falling.

Mr Mungall recently increased the market-neutral weighting in his £34.5m Multi-Manager Cautious fund to a third by adding the £120.4m Artemis Global Hedge fund. Previously, Mr Mungall had a 9 per cent second top holding in the Merrill Lynch Marshall Wace TOPS fund.

The top asset class weighting in the portfolio at the end of May was its 18.8 per cent in fixed income absolute return, including the £161.2m Cazenove Strategic Bond fund. At inception, the product also invested in Goldman Sachs Global Libor +2 and CAAM Invest Var 8.

"We launched the fund with a couple of market-neutral fixed income funds, but we wanted to add some market-neutral equity," he said.

Both the portfolios he bought into have quant at the heart of their processes. The TOPS fund polls brokers and analyses their recommendations, while the Global Hedge fund uses the Artemis stock screen SmartGARP as part of its decision making.

Mr Mungall took pains to differentiate between the process of the funds he has invested in and some of the quant equity strategies that have suffered during the market turbulence of the past year.

"None of the funds we have are exclusively run on a black-box model," he said. "I wouldn't put them all in the same bucket. There's still considerable human input into the Marshall Wace and the Artemis approaches.

"Any strategy that blindly follows a set of rules is liable to get you into trouble. At turning points, they tend to do badly. What we had last year was a rapid move from fear to greed."

All that said, Mr Mungall predicted he would not be adding to his market-neutral plays in the near future. "We're not trying to force funds in the portfolio from some kind of top-down view," he said.

Graham Duce, co-head of multi-manager at Credit Suisse, confirmed the draw of absolute return should diminish when stock markets rise again. "Absolute return is great when markets are falling – Libor +3 looks very attractive right now," he said. "But if equity markets come back into their double-digit returns, it's going to get left behind.

"If it's sold as a panacea for investors, there is a danger of it being a short-term phase."