View more on these topics

Blacksquare nears volatility target

Blacksquare Capital is looking to increase risk in its multi-manager absolute return fund to bring annualised volatility closer to its 4 per cent target.

The fund returned 1.05 per cent last month and year-to-date returns were up to 2.63 per cent. These returns were delivered with annualised volatility closer to 3 per cent, which Blacksquare regards as a great achievement, given the challenging environment faced by its underlying managers.

Capital preservation is at the heart of Blacksquare’s investment strategy and the firm says it has defended capital over the last couple of years while other managers have not. But with the early-stage recovery in risk assets such as corporate bonds, high-yield bonds and equities, Blacksquare feels there is scope to increase annualised volatility closer to its target and is preparing to put this into effect by making some changes to the portfolio.

The firm says it is pleased that nine of the 11 underlying managers in its portfolio generated positive returns in February.

Due to its focus on building its fund through managers that achieve returns in different ways so that the overall portfolio is uncorrelated, Blacksquare says it does not want every single manager to produce positive returns in any given month.

Two funds lost money in February follow different strategies. Melchior European absolute return, which was down 1.69 per cent, is a long-short equity fund. The AC Risk Parity fund, a systematic fund, fell slightly by 0.2 per cent.

Recommended

L&G’s Hodges cuts back on gilts in dynamic bond fund

Legal & General fund manager Richard Hodges has cut the £1.5bn dynamic bond fund’s exposure to gilts and added to financial debt amid concerns that gilts will not offer value in an upturn. Hodges has cut his gilt exposure from 20.7 per cent to 17.7 per cent since November and added that exposure into financial […]

Chancellor considers scrapping 50 per cent income tax rate

The 50 per cent income tax rate could be scrapped or reduced in next week’s Budget, according to reports. The Guardian quotes Government sources saying Chancellor George Osborne “has been intellectually persuaded” of the case to scrap the rate. The FT reports that the Chancellor is considering reducing the highest rate if income tax to […]

Skandia looks at co-brand platform deal for advisers

Skandia’s move to operate an execution-only service for clients brings it into line with other platform providers’ plans. In its 2011 results, published last week, Skandia said it is looking to increase client access to its platform following adviser and client demand. It is considering creating co-branded versions of the platform, with advisers offering financial […]

Will it be further three years for 0.5% bank rate?

The Bank of England’s monetary policy committee has kept bank rate at 0.5 per cent for the 36th consecutive month and has held its programme of quantitative easing at £325bn. Last month, the MPC voted to increase QE by £50bn from £275bn. The MPC says it expects the latest round of QE to take two […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment