Market neutral fund IPO hits $40m milestone
Watermark Funds Management's market neural fund, has exceeded its minimum target of $40 million in the early stage of its initial public offering (IPO).
Watermark global leaders fund limited claimed it was the first locally-managed global market neutral fund managed in Australia.
The fund was an actively managed portfolio of global equities, yet aimed to provide positive returns of 10 per cent or more with no correlation to the share market.
Watermark said it generated a 22.6 per cent return on its global portfolio over the past 15 months.
Founder and chief investment officer, Justin Braitling said in the current volatile environment there were very few ways to avoid market-based risks, other than holding cash or hedging.
"In this [WGF] strategy, market risks are hedged away. Investors can take advantage of exciting opportunities in global shares without having to worry about a falling share market," he said.
"Currency exposures are also hedged, and Watermark's existing market neutral funds are negatively correlated with the share market. This means they typically rise when markets fall.
"You could see this first-hand last Tuesday, when the market fell five per cent intra-day, following Donald Trump's US election win, our investors made money," Braitling said.
Watermark aimed to raise up to $100 million under the initial initial public offering and had the ability to accept up to $150 million in oversubscriptions.
WGF's offer was open until 9 December 2016. Trading on the Australian Securities Exchange (ASX) was expected to commence on 21 December 2016.
Recommended for you
Clime Investment Management has welcomed an independent director to its board, which follows a series of recent appointments at the company.
Ethical investment manager Australian Ethical has cited the ongoing challenging market environment for its modest decrease in assets over the latest quarter.
Commentators have said Australian fund managers are less knowledgeable compared with overseas peers when it comes to expanding their range with ETFs and underestimating the competition from passive strategies.
VanEck is to list two ETFs on the ASX next week, one investing in residential mortgage-backed securities and the other in Indian companies.
