KUWAIT, 12 April 2004 — Global Investment House has much to celebrate. In just three months, Global’s Zenith Fund, the first CTA/hedge fund launched in Kuwait, has raised $50 million under management.
“I am not surprised it reached this level at all,” said Sameer Al-Gharaballi, executive vice president of Global.
“The Zenith Fund is robust. It implements new investment strategies which acts as a very powerful diversification for potential investors. Because it’s new, different, and aggressive, there has been a strong interest both in investors and institutions, who took advantage of the product since day one,” he added.
According to the fund’s article of association, the Zenith Fund aims to capitalize on globally aggressive strategies. The fund has been engineered to generate superior alpha through the use of high beta uncorrelated strategies. In this case, Global has found a compelling argument for uniting CTA (Commodity Trade Advisors) funds and hedge funds. What’s outstanding is that, according to the proforma of the fund, The Zenith Fund has had no negative years for the past four years, which included the three worst consecutive years in stock market history — 2000, 2001 and 2002.
Al-Gharaballi added, “The Zenith Fund has a different strategy. You don’t have CTAs in other hedge funds being offered locally, and we are going with macro and long-short equity managers to give it more spunk.”
He said as of the second month, the Zenith Fund already returned 2.55 percent. The fund’s pro-forma indicated that it returned 20.43 percent for the year 2000, 12.73 percent for 2001, 15.70 percent for 2002, and 20.96 percent for 2003 and has an estimated annual return of 17.21 percent.
The fund offers an attractive risk/return profile with a sharp ratio of 1.9 and a standard deviation of 5.94 percent. Analysts have also indicated that the Zenith Fund has a negative correlation to the global markets, what that means to investors is that the fund will generate absolute positive returns regardless of the direction of the market.
Al-Gharaballi expects the fund size to reach $80 million-$100 million by year-end.
