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Credit Suisse fund transfers to Lombard Odier IM

Credit Suisse fund transfers to Lombard Odier IM

Lombard Odier Investment Managers has taken over a global equity strategy from Credit Suisse.

An agreement between the two firms will see Lombard Odier IM launch LO Funds – Global Prestige on 26 June.

Global Prestige will be invested in a concentrated portfolio of 30 to 40 stocks of companies with the ability to generate sustainable excess economic returns with strong market positions, high pricing power and promising growth prospects.

The fund will aim to deliver maximum capital appreciation by offering investors the opportunity to benefit from structural long-term growth trends such as emerging consumers, millennials spending and other consumer-related trends.

Didier Rabattu, head of equities at Lombard Odier IM, said: "We are delighted to add the Global Prestige strategy to our high conviction equity offering.

"Global Prestige is a strong complement to our well-established expertise in thematic investing, which includes capabilities in the brand, luxury and consumer-related sectors.”

The €236m (£206m) Credit Suisse (Lux) Global Prestige Equity Fund will subsequently transfer into this fund.

Juan Mendoza will join Lombard Odier IM as senior portfolio manager to run the fund.

Mr Mendoza will run Global Prestige with the same investment objective, policy, and approach taken at Credit Suisse Asset Management since 2009.

He will be supported by Ingrid Nouhaud, analyst in Lombard Odier IM's high conviction equity team.

Michel Degen, head of Credit Suisse Asset Management Switzerland and EMEA, said: "Our industry is continuously evolving. Partnering with other firms is crucial if we are to meet the needs of clients and thrive as an industry.

"We are pleased to join forces with Lombard Odier IM to achieve this fund merger."

Stuart Ritchie, director of financial planning at London-based AES International, said the aim of the fund will be to invest into companies with business activities in the production, distribution and sales of luxury goods and services.

The fund will be actively managed across a small universe of companies that match the necessary requirements to be classed as luxury.

He added luxury products are known as emotional assets, which produce a ‘psychic’ income - the pleasure of owning artwork or a very fine wine.

He added: “If you want to pay high fees, with the likelihood of underperforming a comparable, low-management fee index fund, buy an actively managed mutual fund. Most investors do, and their returns suffer as a consequence.”

Sam Instone, director of AES International, said there is a mountain of data indicating the folly of buying these funds, although they are aggressively sold to investors.

He said: "My money is in passively managed funds going forward, and firms such as Dimensional Fund Advisors."

aamina.zafar@ft.com