08 Apr 2024
Every month we study the universe of funds in the investment marketplace to assess whether they meet our exacting standards and should be given the RSMR seal of approval.
Here's the new rated fund from our March review:
The UK Select Fund is a long short portfolio aiming to generate returns of 8-10% p.a. with 5-7% volatility. The focus is on UK companies with a market cap greater than £500m and the fund typically holds 40 long and 40 short positions. The fund looks to be macro, factor and style neutral.
As a market neutral offering not dependent on market cycles, the fund should perform well in most market conditions relative to its cash benchmark but is not seeking to keep up with equity returns in a strong bull market. The fund is suitable for use by cautious or conservative investors who do not want exposure to equity market volatility. Within the context of an overall portfolio, the fund is a useful diversifier from traditional investment options that deliver returns through market beta.
The fund has been managed in a pragmatic risk aware manner allowing returns with no market correlation since moving to Tellworth. The accurate monitoring of potential factor risks has been important to this outcome and the team have generated alpha through stock selection. The fund does not use net positioning to drive returns but has increased the gross positioning as low levels of market volatility has allowed this within the pre-defined risk budget. The results demonstrated by the team that have been delivered to date with admirable consistency, despite a change of one of the co-managers, fully justifies an RSMR rating in the targeted absolute return sector.
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This information is for UK Professional Advisers only and should not be given to retail clients.
The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested.