In this edition of Fund Watch, new fund filings for:
- Balter European L/S Small Cap Fund
- ASG Dynamic Allocation Fund
Balter European L/S Small Cap Fund
On September 15, Balter Liquid Alternatives filed a Form N-1A with the Securities and Exchange Commission (“SEC”) announcing its intent to launch its third mutual fund, the Balter European L/S Small Cap Fund. As is evident by its name, the new fund will take both long and short positions in small-cap European stocks, in pursuit of its objective of absolute returns. The fund is the successor to the S.W. Mitchell Small Cap European Fund, a hedge fund, which will transfer its assets to the institutional shares of the new fund upon its launch. S.W. Mitchell Capital LLP will continue to manage the fund as the sub-advisor.
Typically, the Balter European L/S Small Cap Fund’s portfolio will consist of roughly 60 such stock positions, which may include both listed and non-listed equities; and the fund’s managers can also invest in debt securities, options, warrants, convertibles, and other derivatives. Its net-long exposure can be as great as 150%, and while its net-short exposure could rise to as much as 50%. The fund will have short positions at all times.
The Balter European L/S Small Cap Fund’s predecessor fund has performance dating back to 2008. Its shares returned -6.5% that year, but then posted successive annual gains of 44.6% and 23.8% in 2009 and 2010. After losing 7.7% in 2011, the fund roared back with successive gains of 11.1% and 24.8% in 2012 and ’13, and then returned -0.5% last year. Shares of the new fund will be available in institutional and investor classes, with respective net-expense ratios of 2.24% and 2.54%.
ASG Dynamic Allocation Fund
Natixis Funds Trust II recently filed a Form N-1A with the SEC, announcing its plan to launch the ASG Dynamic Allocation Fund. The new fund’s objective will be long-term capital appreciation, with the protection of capital during unfavorable market conditions a secondary goal. It will pursue this end by means of dynamic tactical allocation across global markets and asset classes, overseen by investment advisor AlphaSimplex Group’s portfolio managers Alexander Healy, Robert Rickard, and Derek Schug.
Healy, Rickard, and Schug will also be charged with the task of managing the fund’s annualized volatility, which is targeted at no more than 20%, as measured by the standard deviation of the fund’s returns. The fund will also use leverage, which will not exceed 200% of assets.
Currently, ASG operates nine alternative mutual funds, including the ASG Global Macro Fund (GMFAX), which was launched in partnership with Natixis. That fund, which debuted on December 1, 2014, returned -3.45% in the first eight months of 2015, ranking in the bottom quintile of funds in its category. Over the three months ending August 31, the fund’s performance was better, in the top quartile, but still negative at -2.03%.