Hong Kong-based fund of hedge funds manager Charles Schmitt & Associates (CSA) has launched the CSA Absolute Return Fund (Dublin) Ltd, a mirror version of its flagship CSA Absolute Return Fund, targeted at the requirements of European and Japanese investors.
The new fund of hedge funds is listed in Dublin and has share classes denominated in US dollars, euros, pounds and yen. All non-US dollar classes are fully hedged. CSA initially acquired the Bahamas-registered, Dublin-listed fund at the end of last year. The fund has now been restructured to invest in seven different strategies, in line with the asset allocation of the CSA Absolute Return Fund.
"We've been getting increasing interest from European investors, but having a listed fund that was denominated in European currencies were the two main things for which they were asking," says Charles Schmitt, managing director at CSA. "So when this fund became available, it was the perfect vehicle for us to replicate our flagship fund for European investors. We also decided to add a yen class for our growing number of Japanese investors."
Jennifer Carver, director at CSA, adds, "The Dublin fund is unique as there are not that many fund of hedge funds managed in Asia that are listed. Its also not that common to see funds with shares denominated in yen."
Carver says the new fund allows investors restricted to investing in listed hedge funds, such as those with UK savings plans, to gain access to CSA's product.
The Dublin-listed fund currently has $17 million in assets under management from its original investors. Carver expects the new fund will receive a strong reception from institutional investors that should take it up to about $100 million in size.
"We just had our first investor meeting two days ago and already raised half a million dollars," she says.
As with the flagship fund, the new Dublin-listed fund invests mainly with US-based hedge fund managers. However Carver says that a multi-strategy fund of funds that invests exclusively with Asian managers is in the pipeline.
"Our team members have spent several years in Asia and know the fund managers here very well. We think we can add value by investing in smaller, lesser known single strategy managers," says Carver.