The Mackenzie Private Equity Replication Fund is Mackenzie Investments’ sixth fund offering in the liquid alternatives space.

The Mackenzie Private Equity Replication Fund is a new mutual fund from Mackenzie Investments. Mackenzie is active in liquid alternatives, and this is its sixth fund in that space. The asset manager launched the fund earlier this month.

The firm expects liquid alternatives to grow to $100 billion in assets under management in Canada within the next few years. (CISION Newswire)

Mackenzie Private Equity Replication Fund

The fund aims to provide retail investors with “the amplified return and managed volatility characteristics of U.S. private equity buyouts.”

By replicating key elements of the private equity investment profile including active exposures to specific industries, leverage, and volatility management, the fund will boost the returns from a portfolio.

The fund considers a U.S. small-cap index to be representative of the private equity arena. Accordingly, the fund will seek out high-quality, highly profitable companies available at attractive valuations. The fund intends to utilize leverage to replicate leveraged buyouts. It will also use hedging strategies to minimize volatility and losses.

Mackenzie developed this investing process after it conducted extensive research with Harvard Business School’s Randolph Cohen, Ph.D.

Private equity outperforms public markets during crises

“Generally, private equity has historically exhibited less downside than traditional investments during periods of market stress and has outperformed public markets during challenging economic conditions,” said Michael Schnitman, Senior Vice President and Head of Alternative Investments, Mackenzie Investments.

Liquid private equity investing

“To date, retail investors have had limited access to private equity risk-return opportunities. We believe that through dedicated research and quantitative expertise, public markets can be leveraged to achieve similar returns and volatility levels to that of U.S. private equity in a format that offers investors daily liquidity, high transparency, and low investment minimums,” added Schnitman.

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