Franklin Templeton Investments has launched a global currency fund aiming to perform in all market conditions, managed by Templeton global macro group’s Sonal Desai and Michael Hasenstab.
The vehicle is a sub-fund of the Luxembourg-registered Franklin Templeton Investment Funds range, and will employ an unconstrained approach, investing in long and short securities and instruments offering exposure to currencies of any country, including both developed and developing markets.
The firm said currencies are increasingly being viewed as a separate asset class in the context of an overall portfolio, given their historically low to moderate correlation to traditional assets.
California-based Desai is director of research in the global macro group and Hasenstab is the group’s chief investment officer. Franklin Templeton’s global fixed income platform will support the investment team.
When constructing the fund’s portfolio, the managers will determine fundamental long-term currency valuations, while analysing short-term dynamics to assess the factors that will drive currencies either towards or away from their long-term equilibrium value.
Vivek Kudva, Europe, Middle East, Africa and India managing director at Franklin Templeton Investments, said that as currency markets are often inefficient, they can provide compelling opportunities to generate excess returns relative to other asset classes.
“In addition, global currencies are often less-correlated with both equity and fixed income markets and as a result, can help diversify the risk in a portfolio,” he added.
©2016 funds europe
