Newscape Capital Group, a London based investment company, has launched its third specialist UCITS fund, its second launch in as many months.
The Newscape Dynamic Rates and Currency Fund will target an annualised return of 12-15% with annualised volatility expected to be around 10%. The fund will invest in the currencies and interest rates of Organisation for Economic Co-operation and Development (OECD) countries and is UCITS approved with daily liquidity offered in euro, British pound, Swiss franc and US dollar share classes.
While many investors have a large exposure to fixed income and equity asset classes, few have any capital committed to active investment in the largest market in the world – currencies, Newscape says, adding that the new fund will offer investors the opportunity to access this market in an extremely liquid and regulated format.
Philippe Bonnefoy, the lead manager of the fund and Newscape’s chairman and CIO, says, “The currency market offers an exciting investment proposition as the majority of participants are not profit seeking. Central banks, sovereign wealth reserve managers, financial institutions, importers, exporters and consumers primarily use the market to hedge or settle financial transactions. This creates many opportunities for those investors seeking to gain from these inefficiencies.
"Through a detailed analytical process the fund uses proprietary quantitative models to identify investable opportunities that have the highest probability of generating excellent risk?adjusted return. The quantitative models identify trend, breakout, mean?reversion and general structural mispricing."
Stephen Decani, Newscape's chief executive, adds, “The currency market is the largest market in the world with daily turnover in excess of US$5 trillion, more than five times the average daily volume of the US bond market or over 25 times the value of the average daily volume of the US equity market. Philippe has spent over three years developing the quantitative strategy and models behind the fund and we are excited to be launching it to the market.”