Legal & General Investment Management (LGIM) has launched Luxembourg domiciled, SICAV version of the L&G Multi-Asset Target Return fund.
The launch marks the latest in a series of recent developments in continental Europe, with senior appointments in Germany and the registration of 23 products for European investors, as LGIM pursues its international expansion plans.
L&G Multi-Asset Target Return - EUR is a target return fund with an unconstrained investment approach, which aims to provide a competitive alternative to equities with a cash + 5 percent return target per annum over rolling three-year periods. The fund has a unique portfolio design in terms of how it looks to generate returns and manage risk. It combines three return streams: diversified market exposure, alternative strategies, and tactical strategies while holistically managing risk to align the investment outcome with the objectives of the fund.
The new strategy aims to have a low reliance on market direction and provides capital preservation. This is achieved through a strong focus on risk management which is guided by three distinct risk objectives: reduce overall volatility; limit the correlation of the fund's performance with that of global equities; and limit the potential losses of the fund due to equity market falls. In practice this means we aim to keep the equity beta below 0.4 on average over a three-year rolling period while limiting the downside participation to less than 40% of equities during significant downturns. It has the flexibility to implement short term views on asset classes, countries, currencies and sectors and there will also be specific trades aiming to provide positive performance during difficult market environments.
It will be managed by the same four people as the existing GBP equivalent; Emiel van den Heiligenberg, Willem Klijnstra, John Roe and Chris Teschmacher. With a truly flexible investment approach, the fund will harness LGIM's investment expertise in asset allocation, active equity and fixed income. It will also take advantage LGIM's scale in low cost index strategies and the expert dealing desk, providing significant savings for investors.
It is available to both retail and institutional investors in Benelux, the Nordics, Sweden, Germany, Ireland and Switzerland.