JEDDAH, 27 April 2005 — Bahrain-based Investcorp has launched a new hedge fund, the Investcorp Balanced Fund (IBF), to meet client demand for a core exposure to hedge funds that can provide a balanced portfolio by diversifying their holdings of bonds and equities.
To demonstrate its confidence in IBF, Investcorp, during the launch period, is offering a zero cost principal protection to new investors. The bank said a new subscription in Investcorp Balanced Fund would be open until end-June with a minimum subscription of $5 million.
“Investcorp is investing around $200 million in this fund from its own capital, and other selective clients are investing another $190 million in the fund that was established in April 2004,” said Ibrahim Gharghour, Investcorp’s managing director of asset management.
Investcorp is offering a free principal guarantee on the investment at the initial period of launch, and targeting an additional $200 million-$300 million, Gharghour told Reuters.
He said the Cayman-based fund will invest in a variety of strategies managed by about 40 managers, focusing on the United States, Europe and Japan.
IBF is a fund of hedge funds. A fund of hedge funds holds a portfolio of different individual hedge funds as its underlying investment. It has the advantage of diversifying risk by blending the risk characteristics and investment strategies of many different hedge funds, which are selected, and then monitored, by a specialist overall manager. For IBF, Investcorp’s expert team has selected about 40 best in class funds, each diversified in investment strategy and style, to achieve consistent and stable returns with a modest level of risk.
IBF is the eighth fund of hedge fund product from Investcorp, which has the largest hedge funds program in the region and is a recognized world leader in this asset class. Investcorp has almost $4 billion of assets under management in its program. Of this, more than $1.6 billion is Investcorp’s own capital. The size of this proprietary investment is unique in the hedge fund industry, and means that there is a strong alignment of Investcorp’s interests with that of its clients. The IBF product is an important addition to Investcorp’s broad fund of hedge funds offering, which accommodates a variety of client preferences as to risk and return.
Investcorp’s Chief Operating Officer Gary Long said: “Investcorp experience in this sector is unmatched in the region. Our hedge funds program is now more than eight years old. In that time it has outperformed benchmarks and proved itself in all market environments.”
