Stewart Ivory Global Opportunities will be run as an absolute return vehicle By Jenne Mannion Stewar...
Stewart Ivory Global Opportunities will be run as an absolute return vehicle
By Jenne Mannion
Stewart Ivory this week launches a Global Opportunities unit trust which will not be benchmarked against any index.
The fund's manager Andrew Dalrymple said the fund is an absolute return vehicle which will invest in stock and bond markets throughout the globe. This will be achieved by using aggressive top down asset allocation.
Dalrymple said: "Asset allocation of the fund will be its most aggressive aspect.
"The portfolio will be able to deploy its assets globally, without reference to any benchmark weightings.
"Therefore, up to 40% of the fund's assets could be in any one area at any time, which means that it could, in some cases be in only three of the six conventional areas, of US, Japan, UK, Asia, continental Europe and emerging markets."
He said without the constraints of a benchmark, he could deploy unlimited assets
in a defined area, regardless
of the total market capitalisation relative to other world markets.
Dalrymple continued: "I don't plan to allocate any more than 40% of assets to a set area to prevent the fund from becoming too area specific and evolving into, for example, an Asia portfolio."
The portfolio will be to invest in fixed interest although Dalrymple plans to do so only for defensive purposes if a significant correction in equity markets is expected.
Within the equity element of the portfolio Dalrymple is going to concentrate on large and more liquid stocks although he will also look for opportunities in smaller companies
Dalrymple said a core list of stocks will be created and these will tend to be large blue chip index stocks, highly tradeable and with a high beta.
The core holdings for any area will amount to approximately 75% of the fund's exposure to that area, enabling the fund to exploit additional situations, without deviating too far from its core list.
At a stock level Dalrymple intends to run relatively large positions. He said: "If the fund was to go to a full 40% weighting in any area that it particularly favoured, it would do so with no more than 20 holdings."
Dalrymple, who joined Stewart Ivory 12 months ago, said he will not fine-tune asset allocation until the end of the offer period on 2 August.
If he were allocating assets today, he would have some 15% in the US, 15% in Europe, 20% in Japan, 20% in the UK,
with 20% in Far East and emerging markets and 10% in cash.
Dalrymple said a preferred theme in stock selection is technology because he believes there is still an upside in this sector.
IFA commission on the fund is negotiable . There is a 5% initial charge on investment and a 1.25% annual. The minimum lump sum investment is £10,000. Dalrymple hopes to raise £5m by mid August.
Despite improved risk appetite
FOS award limit increase
Relates to 136 million transaction reports
Ceremony will take place 13 November