The Ignis Argonaut European Absolute Return Fund has only been up and running since February of this year, so it is probably too early to determine the relative efficacy of its investment policy.
Launched under the auspices of Argonaut Capital Partners LLP, as part of a joint venture with Ignis Asset Management, the fund is lead-managed by Barry Norris, a founding partner of Argonaut Capital Partners.
The estimated total expense ratio (TER) of the fund stands at 1.55 per cent, and returns will also be subject to a 20 per cent charge relating to outperformance on a 5 per cent annual hurdle, subject to the high-water mark.
Nominally, this sterling denominated fund aims to provide its investors with absolute returns from a range of European markets regardless of market conditions, but specifically, Barry Norris has set the bar at "double-digit returns within acceptable levels of volatility."
The fund will operate with what is described as a "high-conviction portfolio", but will endeavour to remain neutral in terms of net exposure at industry level through the use of pairs trades as part of its strategy. At the beginning of October the fund was 6.46 per cent net long overall.
Barry Norris will target companies with what he perceives as "wildly optimistic profit forecasts", in determining the fund's short positions. To this end, he will also gravitate towards companies that are hampered by inadequate capital provisions. As to the contra stance, he intends to go long on the "better businesses in cyclical areas." This points to a fairly cautious approach, which is a reflection of the fragility of market sentiment at the moment.
IGNIS ARGONAUT EUROPEAN ABSOLUTE | |||
|---|---|---|---|
| PRICE | 113.4p | SHARPE RATIO | na |
| BASE CURRENCY | UK£ | 1 MONTH PERFORMANCE | 0.89%* |
| No OF HOLDINGS | na | 3 MONTH PERFORMANCE | 12.5%* |
| SET UP DATE | 18 Feb 09 | INITIAL CHARGE | 5.25% |
| MANAGER START DATE | 18 Feb 09 | ANNUAL MGMT. FEE | 1.50% |
| ESTIMATED TURNOVER | 280% | EST. TOTAL EXPENSE RATIO | 1.55% |
| MAX. LONG EXPOSURE (% OF NAV) | 150% | MINIMUM INVESTMENT | £500 initial £50 savings |
| MAX. SHORT EXPOSURE (% OF NAV) | 80% | MORE DETAILS | ignisasset.com |
Source: Ignis Asset Mgmt. & *Morningstar (09/10/09)
Top Long/Short positions (as at 09/10/09)
| Sector | Percentage |
|---|---|
| Consumer Discretionary | 24.89 |
| Miscellaeous | 9.07 |
| Financials | 8.84 |
| Information Technology | 7.13 |
| Telecommunication Services | 2.41 |
| Utilities | -15.01 |
| Materials | -12.16 |
| Healthcare | -8.79 |
| Consumer Staples | -7.88 |
| Energy | -2.3 |
Long/Short Geographic Allocation
| Country | Percentage |
|---|---|
| France | 14.16 |
| Netherlands | 9.54 |
| Germany | 4.51 |
| Finland | 3.62 |
| Sweden | 2.93 |
| Denmark | -14.62 |
| United Kingdom | -9.12 |
| Norway | -3.33 |
| Switzerland | -2.75 |
| Spain | -2.31 |
