Pioneering Listed Fund Of Funds Gains As It Closes

Dec 19 2013 | 11:04am ET

The first fund of hedge funds to list on the London Stock Exchange is going out the way it came in: with steady, if unspectacular, returns.

International Asset Management, which is liquidating the 18-year-old Alternative Investments Strategies fund, said its net-asset value rose 6.89% in its most recent—and final full—fiscal year. That tracks with the vehicle's long-term returns; it has posted annualized returns of 6.13% since its inception in 1996.

Most of the year's returns, IAM said, came prior to shareholders June vote to shut the fund down, during a period in which it held all of its high-conviction positions.

IAM's Sean Molony's victory lap had a twinge of melancholy, as he wrote that "the outlook is likely to continue to be constructive for select hedge fund managers, and therefore that further gains will be produced from the remaining assets during the wind-down," set to be completed in May.

"It is therefore with some sadness that I conclude my last investment manager's report for this company as the outlook for risk-adjusted returns provided by the hedge funds formerly held in this portfolio look increasingly attractive compared with other asset classes traditionally sought by risk-aware investors."


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