The Ireland-domiciled Ucits fund will be the latest addition to the business’s suite of systematic liquid alternatives products.
It has been launched to meet demand from investors for portfolio-diversifying products that invest in strategies with uncorrelated returns to traditional markets, the company said.
Target and strategy
Star will have a volatility target of 8% and aims to deliver positive total returns on a rolling 12-month basis, uncorrelated to bond and equity markets.
The strategy seeks to capture returns via exposure to a range of systematic investment styles, or style premia, generating long-term results across markets and asset classes.
The core underlying styles are value, quality, momentum and carry, across equities, fixed income, and currency asset classes.
The team
Star’s lead manager, Leif Cussen, has worked on OMGI’s systematic alternative products since joining the business in 2005, including co-developing OMGI’s statistical arbitrage strategy.
Cussen will be supported on the fund by Paul Simpson and John Dow as portfolio managers.
In addition to the management team, a style premia investment committee will provide an additional level of support, oversight and governance to ensure that the fund remains in line with customer expectations.
Diversification
Cussen said: “Star is designed to meet a growing demand for cost-effective systematic strategies. The fund gives investors access to the diversifying benefits of four core systematic styles across multiple asset classes. In addition, it utilises our proven proprietary statistical arbitrage capability to further enhance diversification and mitigate crowding risks typically associated with style premia exposures.”
Donald Pepper, managing director of alternatives, said: “Star is designed to have a very low correlation to traditional assets. We believe the strategy will be a good diversifier to market driven exposures in clients’ portfolios. Further, given its long/short orientation, we see the strategy as a complement to hedge fund strategies, but at a significantly reduced cost.”
