New Star launches new hedge fund product

12 October 2006

New Star Asset Management is to launch its own hedge fund index tracking vehicle, linked to the RBC Hedge 250 Index, it has been announced.

The Hedge Exchange Traded Security (ETS), which has been launched with the backing of UBS Investment Bank, is designed to provide returns representative of the hedge fund industry, relying on the continuation of current strong performance.

The RBS index includes 250 hedge funds covering nine different investment strategies, with closed funds also covered.

Reports suggest that investors are expecting returns of something in the region of nine to 12 per cent per year.

New Star's Ravi Anand has referred to the new product as an alternative to so-called 'funds of funds', offering greater diversity and less risk.

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