Matrix Money Management has created a fund of hedge funds for retail investors that may use a wide range of strategies, including the risky global macro strategy that many hedge funds now avoid.
The Matrix horizon fund aims to protect capital during market downturns while producing higher returns than conventional equity funds in all stockmarket conditions. It invests in an existing hedge fund of funds, the Fortis investment fund, which was established in January 1999.
The Fortis fund is actively managed by Mo Zayan and Andrew Davisson, co-directors of London-based Fortis Investment Advisers. Both are experienced hedge fund managers, having worked together at Ross Capital Markets until 1993. They also managed a global macro fund for Strategic Asset Management, a company they set up in Bermuda.
Through the Fortis fund, the Matrix fund will invest in a broad range of around 35 hedge funds that use long and short equity, market neutral, arbitrage strategies, distressed investing, managed futures and global macro strategies. The weightings of each strategy will be determined by a top-down analysis of economic trends and a prediction of what will happen in the following 12 to 18 months. No single hedge fund will consist of more than 10 per cent of the portfolio.
This product is similar to the Schroders alternative strategies fund diversified hedge fund of funds, which also invests in all types of hedge fund strategies, including global macro. However, the Schroders product has a smaller portfolio of between 20 and 30 individual hedge funds, which may provides slightly less scope to diversify the risks of each hedge fund strategy.