Using an arbitrage strategy, the weekly dealing fund – which is open to all professional non US investors – aims to create returns of 15% per annum, with no upper limit regardless of movements in the underlying commodity.
Domiciled in the Cayman Islands with an Isle of Man feeder (and a potential home in Luxembourg – post launch), the fund enters into contracts with commodity producers and agrees a fixed discount off the spot-price.
These contracts are then sold to the fund’s global network, securing an arbitrage profit for the fund. The buy and sell transactions are simultaneous.
According to Montreux, initial trades will be in gold as the lower price has precipitated increased volume buying globally.
Minimum investment in the fund is 10,000 in all currencies, with an annual management charge of 1.75% and a 25% performance fee. Currencies it is available in are sterling, Swiss francs, US dollars and euros.
According to Montreux, the fund boasts a high level of investor protection with Apex Fund Services administrating the cell, an independent board of directors signing off trade decisions and Cayman National Bank IOM holding custody over investor money.
Montreux Capital Management’s operations and distribution manager, Piers Sword, added that, because the fund is weekly, it has the added advantage of offering a high degree of liquidity. “With on-going economic uncertainty and market volatility investors are looking for generally uncorrelated investment strategies to add diversification to their portfolios, the number one thing on investors’ lips is liquidity with transparent fund pricing and strong corporate governance, this fund provides all of this,“ he said.
The fund’s manager is Thomas Wilson of Sirius Commodities, a former executive director of Goldman Sachs, SVP of AIG International, managing director of Natxis Commodity & Marex Spectron and director of the London Bullion Market Association.
Montreux Capital Management was set up in 2010 and the Montreux Sirius Commodities Fund is the second fund it has launched, the first being the Montreaux Care Home Fund which it launched in June 2011.
