JP Morgan Asset Management (JPMAM), which this week launched a Ucits fund that invests in underlying hedge funds, said the most difficult part of constructing the product was finding managers that could run a compliant liquid offering.
The JPMAM Multi-Manager Alternatives fund is offered as a ‘liquid alternatives’ Ucits and is part of the JP Morgan Funds Sicav range in Luxembourg.
Karim Leguel, Europe, Middle East and Africa head of JP Morgan Hedge Fund Solutions, said the main challenges of constructing the fund were sourcing high quality managers to sub-advise on liquid hedge fund strategies, and the due diligence to ensure that managers were capable of offering a liquid offering within the Ucits compliance regime.
The fund is managed by Paul Zummo, co-founder of JP Morgan Alternative Asset Management, and has seed capital of €92.4 million. It draws on multiple hedge fund managers and aims for returns with lower sensitivity to traditional equity and bond markets.
The fund will initially include between eight and 12 hedge fund managers. A spokesperson for the firm was unwilling to name hedge funds, but says that the fund’s structure (with sub-advisors running managed accounts) means access is to a broader range of managers than would be available through a pure Ucits fund.
JP Morgan’s asset servicing division provides administration and custody, while Deutsche Bank and Morgan Stanley act as swap counterparties.
The fund follows the launch last November of liquid alternatives vehicle, the US Opportunistic Long/Short fund.
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