Palaedino Fund appoints 5 managers to develop passive index strategy
Luxembourg-based Palaedino Fund has appointed five investment managers to implement a passive investment strategy based on indices developed and provided by Palaedino Asset Management.
The appointed managers are Duet Group, Morgan Stanley, Olympia Capital, RBS and Unigestion. Each third party investment manager has been appointed to implement the indices within the various sub-funds, and will seek to outperform the corresponding index by over or under weighting its constituents.
The firm has developed five proprietary indices to accommodate the move to a passive approach that respond to the new economic order that is unfolding.
Palaedino Structural Leaders Index provides exposure to companies which are best positioned within their sector to benefit from the new economic order.
Palaedino Hard Currency Index aims to diversify investors’ base currency exposure by investing in a broad basket of currencies.
Palaedino Diversified Commodity Index provides dynamic exposure to commodities while aiming to lower the volatility of an investment in this asset class.
Palaedino Global Fixed Income Index aims to provide exposure across the full spectrum of the fixed income universe, weighted by GDP rather than by market capitalization to ensure that emerging market growth and its contribution to global gross domestic product are appropriately represented.
Palaedino Euro Fixed Income Index provides exposure to a broad basket of Euro denominated bonds with a duration of less than 5 years.
UCITS Alternative Index Blue Chip provides exposure to the performance of the 50 largest UCITS hedge funds.
According to the firm, this new landscape will be dominated by two opposing forces: inflation and deflation, which will lead to a bifurcation at the macro and micro level.
The indices have been designed to respond to globalization and its impact on financial markets, including the growing importance of emerging markets and their increasing contribution to global output as well as the structural changes taking place in developed countries.
Palaedino will maintain and rebalance the indices, which are based on dynamic rules to ensure they are responsive to changes in financial markets.
“Since the fund was launched in January 2010, we have used a blended investment approach combining active and passive management. We believe that the new approach will enable us to focus on the long term themes that impact each of the underlying asset classes, and avoid the short term noise generated by events associated with European financial crisis for example,” said Alessandro Mauceri, chairman of the board of the group