Managing Partners Limited, the fund management group, has launched two new retail share classes giving access to its Traded Policies Fund. The new share classes, called the “Euro Growth Class” and the “Dollar Growth Class”, have been launched in response to demands from IFAs who have clients – both

The Traded Policies Fund already has a Sterling Growth Share Class for retail investors that facilitate investments from wrap providers as well as insurance companies through wraps, platforms, self-invested personal pensions and private portfolio bonds.

The new share classes carry an initial charge of 5% and an annual management charge of 1%. Commission for intermediaries is 4% initial, although the allocation rate can be raised if the intermediary chooses to sacrifice commission, and 0.5% trail. Returns on the new share classes are expected to be around 7-9% per annum.

Jeremy Leach, Managing Director or MPL, commented: “The UK financial services industry is one of the largest in the world and manages a lot of foreign assets. Perhaps 40% of total assets under management in the UK are held by foreigners, who need dollar and Euro-denominated asset classes. There are a lot of British investors too, including expatriates, who are paid salaries in euros and dollars and need to invest in those currencies. Probably around 40% of the investors in these new share classes will be British.” He added; “A heightened interest in USD investments has been noticeable recently as investors are wishing to capitalise on the weakness of the currency”

The potential for the Traded Policies Fund to deliver steady, incremental returns is demonstrated by the first three-year performance of the institutional US dollar share class in the fund, which returned 28.35% in the three years to 1 July, 2007, significantly outperforming its benchmark, the 10-Year US Government Bond Index, which returned 8.54% over the period, and the Fed Funds Effective Rate, which returned 12.768%. The fund did not suffer a single negative return in any quarter during that period. Since its launch in February this year, the Sterling Growth share class has produced an annualised return of 9.74% net of all charges.

Traded life policies are United States-issued whole-of-life policies sold before the maturity date to allow the original owner to enjoy some of the benefits during their lifetime. Funds that invest in TLPs are low risk because the investor has a good understanding of how much profit will be made from each policy in the fund. A report by Professor Merlin Stone of the Bristol Business School published in October and commissioned by MPL predicted that over the next five years there will be a surge of money from retail investors flowing into funds investing in traded life policies. It pointed out that while the TLP market had risen from $50m in 1990 to $20bn in 2006, it was set to grow to $161bn by 2030.

This entry was posted on Tuesday, December 11th, 2007 at 12:21 pm and is filed under Managing Partners News. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.