Hong Kong’s Pacific World To Launch Fixed-Income Fund

by Carla Johnson, Investors Offshore.com

28 February 2005

Hong Kong-based fund of hedge fund specialist Pacific World is planning to launch a Fixed Income strategy fund which will target a return of 250 basis points over Libor and an annualised volatility of less than 3%, according to the Finance Asia news service.

According to the report, the fund will launch with $12 million in seed capital collected from the firm’s existing institutional clients with around 60% of the fund to be invested in money market instruments. The remaining 30% will be invested in fixed income-related hedge fund strategies such as distressed debt, high yield, capital structure arbitrage and convertible arbitrage.

Chris Choy, Pacific World's CIO, commented that demand for fixed income funds has been growing steadily throughout the Asia region.

"Our fixed-income fund was created to be a replacement for the role of a bond fund or deposit allocation in an investor's portfolio," he stated.

Choy added that the fund will be allocated across five hedge fund managers, and 0.75% management fee will be charged.

However, the fund will not charge a performance fee and investors will need to provide only two weeks' notice in order to redeem from the fund.

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