The Structured Product Fund is due to launch in January and is an Isle of Man regulated fund specifically designed to appeal to the international adviser market.
Clive Moore, managing director of Compass Global Wealth – A UK registered company, said: “Structured products have proved enormously popular in the international market over the last five or six years, delivering consistent returns in a variety of market conditions.
“As a result of their popularity, the sector has attracted some less than scrupulous operators recently, who see it as another opportunity to make money, regardless of the outcome for advisers or investors. This has made it hard for advisers to select from the wide range of products on offer.
“The Structured Product Fund offers an alternative, with professional managers making a diversified selection of products from the secondary and primary market.”
Thomas Miller Investment, the Isle of Man based asset management arm of the Thomas Miller Group, will be investment adviser on the fund, working alongside IDAD which has an 11 year track record of designing and distributing structured products.
Moore, who is also managing director of IDAD, said the fund will aim to deliver annual returns of between 5% and 15% through investment in “selected value-driven opportunities in the secondary market and, where appropriate in new issuance”.
The portfolio itself will be split between core investments, which will make up between 30% and 50%, tactical investments, which can constitute up to 60% of the portfolio, and cash, which will be between 10% and 30%.
The core investments will offer steady growth within the portfolio, made up of relatively low volatility products held for six months or more.
Meanwhile the tactical portion of the portfolio will be bought with the aim of delivering the bulk of the fund’s performance. Moore said these will be structured products which have been bought close to a possible maturity point when the price can be attractive and will be held for short periods of months or even weeks.
All of the underlying assets will be purchased at institutional rates and will be exempt from any commissions or brokerage fees.
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