Threadneedle launches UK Absolute Alpha fund

Threadneedle is set to launch the Threadneedle UK Absolute Alpha Fund for Mark Westwood (pictured) and Chris Kinder.

The UCITS III fund will be the latest to join Threadneedle's stable of absolute funds which run a combined £1.9 billion of funds, and will launch early in the fourth quarter of the year. 

The group said that both Westwood and Kinder had proven long/short experience and had built strong track records of achieving alpha in various market conditions.

Westwood, co-manager of the Threadneedle UK Absolute Alpha fund, said: 'This is an exciting time to leverage our expertise in delivering absolute returns for our clients.  With the dislocations of the past few years still fresh in investors’ minds, the opportunity to add value through fundamental and valuation analysis on a long/short basis remain considerable.

'The Threadneedle UK Absolute Alpha Fund will use the process and techniques that we have successfully employed over the years in our Cayman-domiciled absolute return fund.'

For retail investors the fund will carry a 3.75% initial charge and 1.5% Annual Management Charge (AMC). Institutiaonal investors will pay a 1% AMC and it will also carry a 20% performance for both retail and institutional investors.   

Funds in Threadneedle’s UCITS III Absolute Return range include the Threadneedle American Absolute Alpha Fund, and Citywire AAA-rated Quentin Fitzsimmons' Threadneedle Absolute Return Bond  fund.

The group said the new fund would employ a similar strategy to the Threadneedle UK Crescendo fund which is due to close on October, taking long and short positions in UK equities with stock selection driving performance.

Threadneedle head of UK wholesale Gary Collins said: 'Threadneedle has a proven track record for delivering performance via absolute return funds, and we believe that this fund will leverage our existing resources and experience to the next stage of development for absolute return. We have spoken extensively to our clients and they have indicated a great appetite for a product that will capitalise on the UK investment market in this form. 

'The introduction of UCITS III regulation has triggered strong growth in the regulated absolute return sector and the migration of hedge fund strategies to the transparent, liquid and highly regulated UCITS market looks likely to continue to drive investor interest.'