The portfolio will be managed by absolute return specialist Daniel Capocci, who joined the firm last year from KBL European Private Bankers in Luxembourg, alongside head of product development and investment strategy Dawn Kendall.
The objective of the fund will be to achieve Libor plus 4% to 5% with a volatility target of 5% to 7% from around 23 Ucits funds.
From a strategy level, the portfolio will be split into equal thirds: equity strategies (long/short and market neutral); fixed income and macro strategies; the final third in specialist products such as event driven and merger arbitrage funds.
Architas, which recently achieved a milestone of £9bn AUM, will seed the fund with an initial £20m, and it will be open for daily trading. Details of its costs and domicile – whether it is in the UK or Dublin – have yet to be finalised.
Although still a relatively new area, funds of absolute return funds are becoming increasingly popular as investors look to diversify their exposure across sophisticated Ucits III offerings. Henderson fields the £104m MultiManager Absolute Return fund, run by Tony Lanning, while Saltus and JP Morgan also market similar products.
An in depth analysis of how to chose between or blend different absolute return funds features in the latest August issue of Portfolio Adviser. You too can add to the debate about hedge fund strategies here.
