Liquid Alternatives: Fidelity Canada Launches Three New Liquid Alt Mutual Funds
The new funds bring alternative sources of alpha to Canadian investors.
Fidelity Investments Canada, one of the country’s largest investment managers, announced on Tuesday the launch of its maiden offerings within a liquid alternatives suite for Canadian investors.
According to Fidelity, the new liquid alternative mutual funds can provide diversification benefits to retail investors, resulting in improved risk-return profile for their portfolios. They are designed for investors who want to step out beyond the traditional “long-only” investing strategy. (Markets Insider)
Further, these funds may be considered as differentiated solutions for navigating the considerable volatility across markets in 2020, as well as extremely low interest rates.
The new liquid alternative mutual funds are Fidelity Global Value Long/Short Fund, Fidelity Market Neutral Alternative Fund and Fidelity Long/Short Alternative Fund.
Fidelity Global Value Long/Short Fund
This fund seeks to achieve long-term capital appreciation by investing in long and short equity positions of companies across the world. It may use leverage through short selling of up to 50% of its net asset value and by investing in derivatives.
The fund is managed by Dan Dupont.
Fidelity Market Neutral Alternative Fund
This liquid alt fund aims to generate long-term capital appreciation by investing in long and short equity positions of companies in Canada and/or the United States. It may apply leverage through the use of short selling of up to 100% of its net asset value and investing in derivatives. The fund aims for a low correlation to major equity markets.
This fund is managed by David Way.
Fidelity Long/Short Alternative Fund
The goal of this fund is to earn long-term capital appreciation by investing in long and short equity positions of companies in Canada and/or the United States. It may apply leverage through the use of short selling between 30% to 50% of its net asset value, and by investing in derivatives.
“With the launch of our new alternative suite of products, retail investors can access products that until recently were only available to institutional or high-net-worth investors,” said Kelly Creelman, Senior Vice President, Products, Fidelity. “Our new offerings provide a broader opportunity set for investors seeking returns and diversification benefits beyond traditional “long-only” products.”
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