NEWS ROUND-UP
news round-up
Charles Schwab
signs ETF deal
Charles Schwab has
appointed State Street to
service its newly launched
family of exchange-traded
funds (ETFS). State Street
will provide the eight new
funds with custody, fund
accounting, fund
administration and
transfer agency services.
L&G’s absolute
return funds
Legal & General has
launched two absolute
return products: the UK
Absolute Fund, managed
by Robert Churchlow, and
the European Absolute
Fund, managed by Gavin
Launder. Both will sit in
the IMA Absolute Return
sector and aim to achieve
a positive absolute return
in all market conditions on
an annual basis.
Liontrust to challenge long-only bond funds
with Lux-domiciled Credit Absolute Return
Liontrust has unveiled
details of its Europeanfocused
Credit Absolute
Return Fund, a Luxembourgdomiciled
Ucits vehicle
which will mirror its long/
short credit hedge fund.
It is being launched on 3
March and will be headed
by Simon Thorp, head of
fixed income, and senior
portfolio manager James
Sclater, alongside analysts
Paul Owens and Quentin
Peacock. The team has managed
the Liontrust Credit
Fund since November 2000,
posting 135% growth to
January 2010 versus 52%
return from the ML Euro
HY Index.
The fund is aimed at discretionary
and private client
investors with a minimum
Simon Thorp: heading the new
European-focused fund
investment of £100,000 or
€100,000. Thorp believes it
will attract investment away
from the traditional longonly
corporate bond funds
which ruled the roost in
terms of inflows in 2009.
The team will focus on
taking credit risk rather
than interest rate risk,
which will be hedged out
on a case-by-case basis and
at portfolio level. Although
aiming to generate the
bulk of returns through
alpha generation, the fund
will position itself to profit
from directional trends in
credit spreads.
Investments will be in
the most liquid, vanilla
parts of the credit markets,
and the fund will never
invest in small issues,
structured credit or private
placements. Liquidity provision
is monitored on a
daily basis.
It has an upfront fee of
up to 5% and a 1.5% annual
charge. A performance fee
of 20% of outperformance
over three-month Euribor
is applied, subject to a high
water mark.
Nikko rolls out World
Bank-backed green
bond Ucits vehicle
Japan-based Nikko Asset
Management is to launch
its World Bank Green Fund
for European investors as a
Luxembourg-domiciled
Ucits III fund.
Managed by Stuart
Kinnersley, the fund can
invest up to 100% of its
portfolio in green bonds
issued by the World Bank,
with all proceeds used to
support projects that tackle
the causes and consequences
of climate change
in the developing world.
The World Bank has
issued about $1bn in green
bonds since 2008 and
expects to continue this
programme to respond to
investor preferences and
demand for financing.
The fund will target a
range of international institutional
investors, including
financial groups, pension
funds, banks and discretionary
investment managers.
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