Neuberger Berman has launched an Uncorrelated Strategies fund with $71m (£55m) in seed capital from clients in the UK, Switzerland and Scandinavia.
The fund’s joint goals are to generate positive absolute returns and to focus on strategies expected to be uncorrelated to equities and fixed income, over a market cycle.
The investment team, including portfolio manager Fred Ingham, identifies differentiated strategies such as global macro, equity market neutral, short term trading and trend following, which have historically generated returns distinct from traditional asset classes as well as demonstrated low correlations to each other, over the long term.
Mr Ingham said: “Following more than eight years of quantitative easing and limited volatility, financial markets are likely to witness more challenging conditions over the coming quarters.
"Political agendas and central bank policy are becoming less coordinated going forward, which could drive volatility and dispersion in the equity, fixed income and currency markets.
“This volatility could present challenges for strategies with persistent market beta, while it offers opportunities for less correlated strategies that rely on different ways of making money. Unlike many traditional long-biased strategies, the trading styles selected are agnostic to market direction and have the ability to profit in both rising and falling markets.
“We believe allocating to uncorrelated strategies is a sensible way to navigate this new investment paradigm and our presence in liquid alternatives and established relationships enable us to gain access to successful managers at attractive fees – while delivering enhanced liquidity, risk control and transparency, as well as corporate governance.”
Commenting on the launch, Laith Khalaf, senior analyst at Hargreaves Lansdown, said if your clients are not relying on market beta at all within their portfolio then manager skill really is the driver of returns, and as such it is therefore of particular importance to inspect the fund manager’s track record over a reasonably long time frame.
