Former Liontrust managers Jeremy Lang and William Pattisson are aiming to launch three absolute return funds in October.
The Dublin-based UK growth, UK income and global Ucits III funds are currently awaiting approval with both the UK and Irish regulators.
They will aim for returns of 7% to 10% annually and will be around 50% net long. The two UK-focused products will have between 50 and 100 long positions, and a similar number of shorts. The global fund will take up to twice as many positions.
Lang says the shorting of specific stocks will help limit losses.
"We are focusing on the downside risk in the funds and minimizing our chances of losing money," he says.
He and Pattisson have liquidated their own investments so they can seed Ardevora's funds once regulatory approval is given.
They also hired Ben Fitchew and Gianluca Monaco, from Liontrust and NewSmith Capital Partners respectively, to help with the portfolios.
Lang is urging investors to judge their performance over time against RPI, not the markets where each product invests.
"Personally our long-term liabilities are inflation-linked and so we want a decent return above that. Cash would be the wrong benchmark because it is a low-risk asset," Lang says.
The duo left Liontrust in early 2009, having run most of the assets at the company.
They have worked together for most of their careers, having started at James Capel Fund Managers in 1986.
Suddenly they are all Absolute Return Managers
Isn't it interesting that as soon as absolute returns becomes flavour of the day, fund managers suddenly become good at managing both short and long investments.
In addition this is the same Jeremy Lange that deserted investors in his previous fund which was poor performing over the last three years.
This smacks more of self interest than in the interest of investors.
Posted by: Bob Donaldson
09 Sep 2010 | 15:11
Complain about this comment