New Star International has launched a capital guaranteed European long/short equity hedge fund to be...
New Star International has launched a capital guaranteed European long/short equity hedge fund to be managed by Richard Pease, with Alan Miller advising on UK equities.
The New Star Capital Guaranteed European Hedge fund, with a minimum $50,000 investment, will be wrapped with a rising capital guarantee provided by HSBC Bank.
Under the guarantee, investors will be repaid at least $100 per share, the launch price, on the maturity date in April 2008.
Pease already runs a European long/short hedge fund for the group. The new fund will largely mirror the existing portfolio, except in its leveraging rules.
In order for the guarantee to function, the fund must deleverage rapidly if it gets near to breaching a defined NAV level of around 85% at launch, at which point it would cease trading and move into bonds in order to meet its repayment obligations.
After launch, the level of protection will subsequently rise periodically as the fund's NAV grows. It is the second capital guaranteed hedge fund offering from the group, following the launch of the New Star Capital Guaranteed Hedge fund which raised more than $181m in the last quarter of 2001. The offer period for the European fund closes on 12 April 2002.
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