Wealth Manager - the site for professional investment managers

Register to get unlimited access to all of Citywire’s Fund Manager database. Registration is free and only takes a minute.

Hume Capital to launch absolute return fund

Hume Capital to launch absolute return fund

Hume Capital is to launch an absolute return fund by early next year.

Hume set the launch in the context of the tapering of quantitative easing, noting that the withdrawal of such support could shake all asset classes.

To distinguish its own absolute return fund, and recognising the poor record of many others, Hume has emphasised its value bias. ‘Unfortunately many absolute return or market neutral fund investors have suffered badly in volatile markets,’ said Sam Batcharj, Hume’s marketing director.

‘Excuses are given: crowded trades, portfolio commonality, liquidity withdrawal and redemptions to name a few. We believe that our approach of analysing and factoring in the leverage of company balance sheets identifies more meaningful valuation discounts and far more robust hedging ratios.’

Batcharj added: ‘The more mainstream conventional valuation techniques, using measures such as price to book, generate a bias to owning more leveraged companies. These tend to be under hedged fundamentally, thereby concealing a long portfolio exposure that will suffer more than expected in market drawdowns.’

Managed by Mark Baker – who co-founded Eriswell Capital, a multi-strategy hedge fund – the Hume product will employ pair trades to exploit such anomalies.

Hume is developing the fund with Phoenix Fund Services, and has £10 million of committed assets. With a Ucits structure, it is expected to have a £1,000 minimum investment; Hume has yet to finalise the fund’s fees.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play JPM’s Negyal: Back divis to temper EM volatility

JPM’s Negyal: Back divis to temper EM volatility

Omar Negyal, co-manager of the JPMorgan Global Emerging Markets Income trust, says a dividend approach to emerging markets reduces the volatility of investing in the asset class.

Play WMR: Why Russia will lose this war

WMR: Why Russia will lose this war

Author and journalist Adam Lebor believes a perfect storm is brewing when it comes to the Russian economy. .

Play WMR: Gerard Lyons warns Asia is the real risk, not Russia & Ukraine

WMR: Gerard Lyons warns Asia is the real risk, not Russia & Ukraine

Chief economic adviser to London mayor Boris Johnson outlines the geo-political risks in Asia and explains why the risk of another eurozone crisis must not be underestimated.

Your Business: Cover Star Club

Profile: The adviser that tempted Robin Minter-Kemp on board

Profile: The adviser that tempted Robin Minter-Kemp on board

It is rare to meet an impassioned individual who is willing to bang the drum for investment advisory right now

Wealth Manager on Twitter