Bloomberg – Man Group Plc, the world’s largest publicly traded hedge fund manager, began selling a managed futures fund with a capital guarantee to Hong Kong individuals seeking protection from falling stock markets.
Man AHL Guaranteed Futures 3 Ltd. will trade mostly futures and option contracts on currencies, bonds, stocks, interest rates, metals, energy and agricultural products using computer-driven models, according to a fund sale brochure.
Credit Suisse Group will provide a guarantee for 90 percent of the initial investment in the dollar shares of the fund. The Australian dollar shares will be 105 percent capital guaranteed.
A 22 percent decline in Hong Kong’s Hang Seng Index since its Oct. 30 peak is forcing the city’s residents to reduce stock holdings and seek capital protection of their investments.
"We’re seeing strong demand for products that allow investors to diversify away from equities,” said Giselle Lee, head of sales for Man Investments (Hong Kong) Ltd. The protection of the initial capital investment adds comfort, "especially for first-time investors in alternative products.”
Managed futures funds bet on the directions of markets for various assets by trading instruments such as futures, options and forward contracts. Man Group began selling its capital guarantee fund in Hong Kong yesterday.