Ignis ponders higher-risk absolute return fund

Ignis Asset Management says it may launch a higher-risk version of the absolute return fund the firm launched in March.

The fund is managed by chief economist Stuart Thomson and head of rates Russ Oxley.

Speaking to Money Market-ing, Thomson says: “We have put the absolute return fund at the centre of our rates’ process. We have the clear-curve portfolio management system that allows us to cascade down the view from the absolute return fund into all the other funds based on their disparate risk and return requirements. In time, we might consider launching a higher-risk version of the absolute return fund.”

Thomson believes absolute return is a good fit in the current financial climate. He says: “The beta-type products that worked in the last decade and a half of great moderation are not going to work in the more volatile times that we face.

“Our absolute return fund is designed to work in a decade of volatile inflation and limited expansion.”

Yellowtail Financial Planning managing director Dennis Hall says: “Higher risk does not seem to fit into the same sentence with absolute return fund. Instantly, it sets off warning bells.”