Black Enterprise – New Star Asset Management is to launch a passive hedge fund index tracker that aims to better mirror industry returns. The Hedge ETS will be a London-listed daily tradablesecurity, providing access to performance representative of the hedge fund asset class through investment exposure to the RBC Hedge 250 Index.
“Hedge ETS offers unique access to the performance of the hedge fund asset class through a well constructed index and the added benefit of daily liquidity,” said Ravi Anand, New Star’s head ofstructured products, in a statement. “We believe that Hedge ETS is the most representative investable benchmark for hedge fund industry returns and should be attractive to both institutional andsophisticated private investors seeking to benefit from the portfolio diversification benefits provided by hedge fund returns.”
Passive hedge fund instruments have traditionally shadowed the performance of investable indexes built around, for example, the Credit Suisse/Tremont indexes. But with many existing funds closed tonew investors, investable indexes can find it impossible to replicate their target’s exposures and performance.
