James Williams, Hedgeweek

UCITS attracted EUR21billion in net inflows in October… Verrazzano Capital launches first long-only fund…

Guillaume Rambourg’s investment boutique, Paris-based Verrazzano Capital, has launched the Verrazzano Advantage European Fund. The UCITS-compliant fund, established in Luxembourg as a SICAV, aims to achieve long-term capital growth by investing at least 80 per cent of its assets in the shares of companies listed in Continental Europe. This is the first long-only fund available to Verrazzano’s investors following the launch of two equity long/short strategies last year.

Rambourg was quoted as saying: “We’re delighted to launch our first long-only fund and make it available to a broad investment audience. It is an important milestone for Verrazzano Capital, which has evolved quickly since 2011 thanks to investor appetite for our tried and tested investment approach and the meticulous path we took to building out the institutional platform.”
 
Verrazzano Capital, run by a team of 16 professionals, has a strong legacy with its genesis in the European Large Cap team at Gartmore. Rambourg was co-portfolio manager of Gartmore European Selected Opportunities (OEIC) and Gartmore Continental European (SICAV) funds between 1997 and 2010 and of various AlphaGen hedge funds including Capella, Tucana and Acamar (1999 to 2010).

 
To date, Verrazzano funds have benefitted from strong endorsement by investors and firm assets stand in excess of USD500million. 
 

 
Kepler Partners, the research-led distribution business, has partnered with Verrazzano to distribute the Advantage European Fund to UK Institutions. “We have seen significant interest in this fund launch from investors looking to allocate to European equities. Guillaume has a large following in the UK and we are very excited about the prospects for this fund,” said Laurie Robathan, partner at Kepler Partners.
 
Harcourt, the alternative boutique of Vontobel Asset Management, announced this week the launch of a Pure Premium Strategy to offer liquid alternatives in a UCITS wrapper to further meet investor demand for transparent and cost-efficient alternative strategies.
 
The Vontobel Fund – Pure Premium Strategy, managed by Martin Tschunko, offers state-of-the-art diversification benefits to institutional and private clients in periods of stress in financial markets.
 
The fund complements Harcourt’s newly created "Research-Driven Strategies" product line, which also includes Pure Momentum and Pure Dividend strategies.
 
The fund is actively managed and aims to systematically earn option premia from various asset classes worldwide, (for example by selling options). At the same time it significantly reduces market-price risk, for example through active management using derivatives. The fund mainly invests in liquid call and put options that Harcourt believes, based on in-house systematic analysis, represent attractive investment opportunities. The fund’s aim is to achieve a risk-adjusted return exceeding the three-month US-dollar LIBOR by 3 per cent to 5 per cent.
 
UCITS attracted net inflows of EUR21billion in October, reversing net outflows of EUR15billion in September according to the latest report by the European Fund and Asset Management Association (EFAMA). Equity funds attracted net inflows of EUR17billion, up from EUR14billion in September. Bond funds registered net outflows of EUR1billion, compared to net outflows of EUR9billion a month earlier.

 

Net sales of balanced funds amounted to EUR8billion, compared to EUR5billion in September. Money market funds registered reduced net outflows in October of EUR5billion, down from EUR24billion in September.
 
 
Total net assets of UCITS stood at EUR6.86billion at the end October 2013, representing a 1.6 per cent increase during the month. In addition, total net assets of non-UCITS increased in October by 1.7 per cent to stand at EUR2.77trillion at month end. Combined total net assets of the European investment fund industry stood at EUR9.63trillion. 
 

 
Bernard Delbecque, director of economics and research at EFAMA, commented: “Signs of a gradual pick-up in economic activity in Europe and expectations of continued support from central banks boosted investor demand for long-term funds in October.”
 
Finally, Old Mutual Global Investors has launched a Dublin-domiciled version of the Old Mutual UK Alpha fund reported Citywire Global this week. The fund, which is co-managed by Richard Buxton and Errol Francis, has grown from GBP150million to over GBP1billion in assets under management since Buxton started managing the fund in June after joining from Schroders. Buxton built a 10-year track record running the Schroder UK Alpha Plus fund before he took the decision to resign in March this year.
 
Speaking about the launch of the new fund, Buxton commented: “Flows into the Old Mutual UK Alpha Fund have been positive since June and assets under management currently stand at circa GBP1billion. We have also received increased demand from our international client base and therefore decided that it was appropriate to provide a vehicle for them to access this strategy.”

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