Man AHL launches futures fund for retail

The latest iteration of the Man AHL Guaranteed Futures fund stomps into view.

The Man AHL rhinoceros is about to return to Hong Kong MTR hoardings with the Man AHL guaranteed futures 4 (90% guaranteed) fund, which is designed for local retail investors.

Introducing the thick-skinned herbivore, Man Investments' Giselle Lee says that she isn't too worried about their other managed futures funds having a slightly off-colour 2009. Managed funds love directional trends, and with markets volatile this year, the three versions of the offerings are down between 7% and 9%.

The reason Lee can be thick-skinned about directionless markets is twofold. Firstly, managed futures funds, Man AHL's included, were on a romp in 2008, Man's triptych up by approximately 20% on an annualised basis, and secondly, these funds have a capital guarantee structure, which means an investor doesn't get minibonded out of the game.

The principal guarantee is from Credit Suisse and starts out at 90%, and with a profit lock-up feature, that can rise to 100%. The first version of the fund (2006 vintage) is already locked in at 100%, and the second (established 2007) is now just a hair's breadth away from the tonne.

The new eight-year tenor fund has a 3% management fee. It invests in 170 developed and emerging markets across 35 exchanges. It's the usual spread of futures contracts, topped by foreign currencies, with a 25% approximate portfolio concentration, followed by bonds and stocks, down to agriculturals, the thinnest markets, which should account for about 5% of the portfolio typically.

The final piece of good news is that the fund is authorised by Hong Kong's SFC.

¬ Haymarket Media Limited. All rights reserved.