Sam Liddle: Not all absolute return funds are created equal

Absolute return funds have attracted some criticism this year, with arguably the biggest gripe being that they failed to protect capital during the first-quarter sell-off in markets. While we would always argue a few months is too short a time to judge any investment, the continuing debate raises some important points about the nature of absolute return funds and how risk is managed. To our mind, an absolute return fund should have a number of key characteristics. First, it should start with cash - and every investment beyond cash should offer a compelling reward potential, for an approp...