Man Group Launches Retail Managed Futures Fund In Hong Kong

by Mary Swire, for LawAndTax-News.com, Hong Kong

22 August 2006

Man Group plc, the London-based global hedge fund provider, has announced the launch of a futures and options fund aimed at retail investors in Hong Kong, the first fund of its kind to be established under regulations issued last year.

Man AHL Guaranteed Futures Ltd. will invest in more than 100 futures and options markets around the world through a computer-based quantitative trading system. Man hopes to raise at least $10 million over the initial four-week subscription period, which began on August 21. The management fee is 3%, and the performance fee is 20%.

A capital guarantee scheme provided by HSBC ensures that investors will receive a minimum of 90% of their initial investment when the fund matures on November 30, 2011.

The fund is authorised by the Hong Kong Securities and Futures Commission as a retail hedge fund, meaning that investors can invest as little as US$5,000.

Hong Kong's hedge fund rules were relaxed last year to enable retail investors to invest in certain alternative funds such as funds of hedge funds. However, the SFC decided to leave the minimum investment in riskier single hedge funds at US$50,000, citing the need to ensure investor protection.

A similar futures fund launched by London-based Man in Hong Kong in May 1998, the Man AHL Diversified Futures Ltd., now has more than $600 million in assets under management. This fund has produced an annualised return of 13.8% and had US$16.1 billion under management as of June 30, 2006.

Man expects that the new fund will also produce annualised returns in the double digits.

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