AEGON Asset Management has launched its first absolute return fund to be run by its UK equity team.
The UK Equity Absolute Return fund is managed by David Griffiths and David Pringle, who will be supported by the 12-strong UK equity team headed by Stephen Adams.
As previously reported in Investment Week, the fund will consist of three portfolios; long equity, short equity and cash. The size of the long and short portfolios will vary according to the manager's discretion but will typically not exceed a 10% net long or short position.
The vehicle will hold between 50 and 100 stock positions and will be constructed using contracts-for-difference, which are a means of gaining long and short exposure to individual stocks. The fund will contain the best ideas from the UK equity team's research with more weight given to ideas which diversify risk.
It is structured to be uncorrelated with the equity market and aims to generate out-performance of its benchmark through diverse and uncorrelated strategies. Although it will not have an overriding theme, it is expected to benefit from macro-economic and other themes identified by the UK team.
To mark the launch of the UK domiciled Ucits III fund, Aegon has discounting the product's initial charge by 2.5% to 3% until 30 April.
"This is an exciting addition to our current UK equity fund portfolio, which will be able to maximise the stock-picking process our UK team has been deploying so successfully over the last few years for its various funds," head of retail sales Steve Kenny says.
"Both David's are very experienced UK equity investment managers and analysts, and they will be ably supported by Stephen and the wider UK team."
