London-based Global Investment Advisers (GIA) has introduced the GAIM hedge fund.
The fund is listed on the Dublin Stock Exchange and is domiciled in the British Virgin Islands. Available to UK investors, the minimum investment into the fund is either $10,000 or 10,000 Euros
Aimed at high net worth sophisticated investors who understand the way the hedge fund market works, the fund will have a passive investment strategy. It will use up to 20 hedge funds that will be divided into four main strategies in order to spread the risks.
The four strategies will be macro, market neutral, long short equity and event driven. Macro hedge funds are ones which are affected by major economic events that have a global effect, such as falls in major currencies like the dollar. Event driven hedge funds are related to the macro area and are affected by economic developments in individual countries. Market neutral hedge funds invest in areas where the markets are relatively stable and do not go up or down by much. Long short equity hedge funds buy when prices are low and seem likely to rise, and sell when they are high and seem likely to fall.
Hedge funds can be risky investments as they rely on the ability of their managers to effectively outguess the markets. However, the global hedge fund market has seen strong growth in 2001. According to a recent report by TASS Research, the research arm of investment company Tremont TASS, $8.4bn in new business was invested into hedge funds in the second quarter of 2001. Total new investment for 2000 was $8bn.
According to Standard & Poors the Argyle global equity appreciation fund, which is managed by Global Investment Advisers, is ranked 37 out of 245 funds, based on £1,000 invested on a bid-to-bid basis with gross income reinvested over three years to August 27, 2001.