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Macquarie seeks out the alternatives

The European arm of the Australian Macquarie Bank Group has entered the UK IFA market with three funds investing in alternative asset classes.

The company has been managing funds for 25 years and is in the process of expanding internationally. It believes IFA demand for alternative asset classes is growing but there are few opportunities for advisers to access them.

According to Macquarie, UK institutional investors are already looking at asset classes such as infrastructure and its global infrastructure securities fund will open this up to retail investors.

Infrastructure can de defined as companies and facilities that provide essentials such as water, roads and airports. While demand for new and upgraded infrastructure is growing, government spending is falling so the private sector is increasingly being used to meet the growing demand for essential services. These companies almost have a monopoly with high barriers t entry, which means income and growth is predictable.

The CF Macquarie global private equity securities fund will invest in 10-25 listed private equity securities. The company says that as each private equity company has an underlying portfolio of unlisted companies, it does not need to diversify across more than 25 holdings as the overall portfolio will comprise hundreds of companies.

The fund will target private equity companies that buy companies at the right price and are able to grow them over time though active ownership. This means the private equity company will invest cash and will also apply skills such as business strategy and financial restructuring.

Macquarie says its global property securities fund distinguishes itself from its peers in that it takes a regionalised view of global property markets, with regional factors seen as the driver behind each market. It believes its experience in Australia and Asia alongside its appointment of specialist European and US property advisers give it a competitive edge,

Advisers may be interested in these funds to diversify their clients’ portfolios across uncorrelated asset classes. However, it may take time Macquarie to establish its name in the UK and for retail investors to invest in infrastructure as an asset class.

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