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Hargreaves Lansdown adds SVM fund to Wealth 150

Hargreaves Lansdown has added the SVM UK absolute alpha fund to its Wealth 150.

The fund is run Colin McLean and has the ability to hold both long and short positions.

Hargreaves Lansdown senior analyst Meera Patel says: “Trying to profit from shares that fall in value requires a particular skill and Colin McLean has demonstrated this successfully on an existing fund (not currently available to private investors), although past performance is not necessarily a guide to the future. While the strategy is expected to lower volatility compared to traditional UK equity funds, its application of alternative investment techniques can make it a higher risk fund. There may also be times when the market rallies strongly and this fund could underperform.”

The fund has an annual charge of 1.5 per cent plus a performance fee of 20 per cent on returns in excess of the 3 month sterling LIBOR – London Inter-Bank Offered Rate.

Patel says: “McLean has demonstrated an excellent track record managing a fund of this nature. We believe the overall strategy could reward long term investors and can complement more traditional UK equity funds


Mid-cap or madcap?

The mid-cap and small-cap sectors suffered last year in a sharp sell-off as fund managers with the remit to do so switched to large caps in an attempt to defend assets.

Funds yield to sector switch

Advisers believe more funds are likely to move across to the newly launched IMA UK equity income and growth sector as the search for yield gets tougher.

Emerging patterns

The problems in financial systems globally – and more particularly in developed economies – are structural. We need to see banking systems, corporates and consumers deleverage their balance sheets. This is going to be a painful process but a necessary one that will take time to work.

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