Four launches low volatility global equity strategy
Four Capital Partners has launched its new low volatility global equity strategy, Stable Global. Four is currently talking with third parties to attract cornerstone investments, but in any case, the live portfolio will start in September with a USD50m segregated account.
Four’s wider portfolio, Active Global, has been going since December 2010.
Colin McQueen, head of the global team, says: “The focus of the Stable Global strategy is to deliver attractive real returns (CPI + circa six per cent), but with much lower volatility and downside risk than the wider equity market. The portfolio will concentrate on the most stable portions of the equity market (roughly 30 per cent) consisting of companies with the most robust businesses, with low cyclicality, low capital requirements and strong balance sheets. The portfolio should consistently exhibit lower volatility than the overall equity market. It should also perform better than overall equities in a weak or moderately rising market, but may lag in a sharply rising market.”
Derrick Dunne (pictured), a founding partner of Four, adds: “There is clearly a growing demand for a high quality low volatility global equity product, particularly in the current climate. The potential for real returns from equities looks very attractive relative to other asset classes such as index-linked or conventional bonds. One of the main drawbacks for many institutional investors is the higher volatility of returns from equities and the memories of recent losses. We are confident that Stable Global Equity can help to bridge that gap and deliver on its performance objective. Colin has been investing in global equities very successfully, in up and down markets, for over 20 years.”
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