Aegon Asset Management launches UK Equity Absolute Return Fund
Monday 1st March 2010
By Mike Jones
Aegon Asset Management is launching a UK Equity Absolute Return Fund which aims to capitalise on the group's successful UK equity investment process from its award-winning UK equity team.
The fund intends to provide investors with positive absolute returns regardless of the direction of UK stocks. It will do this through investing in long and short positions in UK listed equities, with a strong focus on reducing volatility and preserving capital.
Managed by David Griffiths and David Pringle from AEGON Asset Management's UK equity team, the AEGON UK Equity Absolute Return Fund will use the team's successful stock-picking process to select assets. The fund will consist of three portfolios, long equity, short equity and cash. The size of the long and short portfolios will vary according to the manager's discretion but will typically not exceed a 10% net long or short position.
Griffiths and Pringle will be supported by the 12-strong UK equity team headed by Stephen Adams. The UK team has demonstrated its ability to provide competitive investor returns over the last five years with the UK Equity Fund managed by Adams returning 44% giving it a first quartile ranking.
The AEGON UK Equity Absolute Return Fund will normally hold between 50 to 100 stock positions and will be constructed using contracts-for-difference, which are a means of gaining long and short exposure to individual stocks. The fund will contain the best ideas from the UK equity team's research with more weight given to ideas that diversify risk.
It is structured to be uncorrelated with the equity market and aims to generate out-performance of its benchmark through diverse and uncorrelated strategies. Although it will not have an overriding theme, it is expected to benefit from macro economic and other themes identified by the UK team working closely with AEGON Asset Management's head of strategy and chief investment officer.
To mark the launch of the fund AEGON Asset Management will be discounting the funds initial by 2.5% to 3% until 30 April 2010.
AEGON Asset Management European head of retail sales Steve Kenny said: "This is an exciting addition to our current UK equity fund portfolio, which will be able to maximise the stock-picking process our UK team has been deploying so successfully over the last few years for its various funds.
"Both Davids are very experienced UK equity investment managers and analysts, and they will be ably supported by Stephen and the wider UK team."
The fund is a sub fund of the AEGON ICVC a UK domiciled Oeic and will have Ucits III investment powers.
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