Franklin Templeton Investments has launched a long/short fund aiming to take advantage of the "inefficient" nature of global currency markets.
Executive vice president and chief investment officer Michael Hasenstab and Sonal Desai, senior vice president and director of research for Templeton Global Macro, will manage the Luxembourg-registered Templeton Global Currency fund.
Using an unconstrained approach, the fund will invest predominantly in securities and instruments offering long or short exposure to currencies of any developed or developing country.
Mr Hasenstab called the fund an “all-weather strategy” for its ability to go long or short in any currency.
He said: “By keeping a pulse on evolving economic and policy trends and employing our disciplined investment approach, we can uncover emerging opportunities to make compelling investments where the ability to go long or short allows us to best express our long-term views.
“While our investment philosophy and approach to managing currencies has remained unchanged over nearly three decades, this new fund enables us to focus on our high-conviction currency views with access to an entire opportunity set of global currency investments in developed and developing markets.”
The ongoing charges figure for the vehicle is expected to be 1.35 per cent.
The low to moderate correlation to traditional asset classes means that currencies are increasingly being viewed as a separate asset class in the context of an overall portfolio.
Vivek Kudva, managing director for Emea and India, said: “Currency markets are often inefficient and can provide compelling opportunities to generate excess returns relative to many other asset classes.
“In addition, global currencies are often less correlated with both equity and fixed income markets and as a result, can help diversify the risk in a portfolio. We believe that this new Fund will be appealing to investors seeking absolute return strategies that aim to deliver a positive return regardless of market environment.”