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Blacksquare plans fund of absolute return funds

Blacksquare plans fund of absolute return funds

Investment boutique Blacksquare Capital has joined the race to launch a fund of Ucits III absolute return funds.

The firm, which specialises in alternative multi-manager products, is planning to launch the IFSL Blacksquare Capital Absolute Return Balanced fund in October or November, subject to regulatory approval. The news comes two weeks after Citywire Wealth Manager revealed that Collins Stewart was looking to launch a similar proposition.

Blacksquare chief executive Christopher Peel (above) said the time is ripe to launch an Ucits III-compliant fund of absolute return funds, owing to a growing need to provide investors with due diligence and diversification across the absolute return sector.

Peel said: ‘Investors want exposure to a regulated portfolio that offers diversification across asset classes, which is tax-efficient and liquid.’

Peel has seen ‘huge interest’ in the fund and hopes it will be sold through a number of private banks and platforms that he is in talks with. He expects seed money to come from the IFA network and family offices.

The Blacksquare fund will be managed by the firm’s research head Richard Sherwin. It will contain between 10 and 15 absolute return funds and aims to achieve a diversified exposure across different asset classes.

The fund will provide daily liquidity and aims to achieve cash +5% a year, although Peel does not wish it to be viewed strictly as a ‘cash-plus product’, but rather as a sophisticated multi-manager fund.

Peel said groups likely to have funds in the portfolio include BlackRock, Gartmore, Brevan Howard and Goldman Sachs Asset Management. The fund is expected to have an allocation of about 40% towards fixed-income strategies, 22% foreign exchange and 21% in equity-related strategies.

Blacksquare was set up four years ago by Peel and Madilean Coen. It has a three-strong fund of hedge funds range, which comprises the Blacksquare Capital Access, the Blacksquare Capital Global Macro fund and Blacksquare Capital Commodity funds.

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