Product category:
Investment funds
News Release from: Resolution Asset Management | Subject: Investment funds
Edited by the Insidemoneytalk Editorial
Team on 19 March 2008
Maia multi-managers shun cash as they
add new funds
Maia Capital founders Chris Ralph, Simon Mungall and Jason Collins say they have no intention of following the multi-manager herd into cash,
pledging to keep their portfolios fully invested to maximise the ability of the underlying managers The founders, whose multi-manager Growth, Balanced and Cautious portfolios launched in October 2007, say they refuse to allow market volatility to stop them investing in funds, arguing that weaker markets tend to produce a wider range of returns for skilful and disciplined fund managers to exploit
This article was originally published on Insidemoneytalk on 30 Mar 2007 at 8.00am (UK)
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The Maia managers, who say investors "do not pay us to hold cash", believe the underlying managers in their portfolios would fail to fully benefit from the opportunities they unearth if the capital allocated to them was reduced.
Instead of lowering their exposure to markets, the Maia managers believe it is vital for them to maintain a robust strategic asset allocation for the medium term, ensuring that they do not allow themselves to be distracted by short-term market moves.
The managers, who recently interviewed more than 50 fund managers during a trip to Asia, have added several funds to their portfolios as they increasingly focus on alternative ways to preserve capital and generate alpha.
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In the Cautious fund they have added the Marshall Wace TOPS UCITS fund, which is a market neutral fund that draws on the expertise of 1400 brokers as a diversifying source of alpha.In the Growth and Balanced portfolios they have added the Melchior Japan Opportunities fund, managed by FuNNeX Asset Management, following recent meetings with the company and manager in Toyko.
Ralph, Mungall and Collins are confident that the fund, which has previously underperformed, will add significant value to both Maia portfolios following extensive quantitative analysis.
By late March the managers expect to have added more funds to the Cautious portfolio as they continue to seek uncorrelated sources of alpha.
Mungall says: "In current market conditions we think it is a question of holding your nerve and staying invested.
We are not trying to call short-term moves - investors do not pay us to hold cash - we are simply doing what we say we are doing, which is buying funds with managers who take enough risk to genuinely add value.
Looking for uncorrelated sources of alpha is key for us and we go to great lengths to ensure that is what we are buying - not beta in disguise.
"We think taking a strategic, long-term view is vital, which in our case means backing good fund managers to do their jobs and looking for relatively unusual funds to invest in, as demonstrated by our recent changes.".
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