Columbia Threadneedle Investments has rolled out a Luxembourg-domiciled long/short absolute return European equity fund.
The Threadneedle Pan European Absolute Alpha fund will hold 40 – 80 positions, targeting a 6-8% annual return above the benchmark.
The investment process will mirror the Threadneedle UK Absolute Alpha and the Threadneedle (Lux) American Absolute Alpha funds that employ a high-conviction, bottom-up stock selection process.
The UCITS-compliant fund will be co-managed by London-based portfolio managers Paul Doyle and Fred Jeanmaire.
“In an era of low-interest rates and political uncertainty, as exemplified by the Brexit vote, we believe that a low volatility, absolute return strategy fits with our clients’ needs. We expect uncertainty to persist in Europe, with the upcoming referendum in Italy and elections in France and Germany, providing us with attractive investment opportunities on both the long and short side,” Doyle said.
Columbia Threadneedle head of wholesale distribution for EMEA and Latin America Gary Collins said: “Given the extreme market moves in the past months, our clients are looking for ways to reduce the impact of volatility on their portfolios while generating consistent risk-adjusted returns.”
The fund is initially registered in Luxembourg, with plans on to eventually distribute it0 across other markets including the UK, Austria, Belgium, France, Germany, Italy, the Netherlands, Portugal, Singapore, Spain, Switzerland, Finland, Norway and Sweden.