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Premier Diva sings popular theme

PREMIER FUND MANAGERS

Premier Diva Growth Plan &#45 Limited Editions 19

Type:
Capital-protected fund of hedge funds

Aim:
Growth linked to the performance of the Barclays Global Investors Diversified Alpha Fund 1

Minimum investment:
£25,000

Investment split:
100% linked to the performance of the Barclays Global Investors Diversified Alpha Fund 1

Term:
Five years

Return:
Up to 70% growth in the Barclays Global Investors Diversified Alpha Fund 1

Guarantee:
Original capital returned in full regardless of performance of underlying investments

Place of registration:
Guernsey

Charges:
Implicit

Closing date:
July 5, 2004

Commission:
None

Tel: 014883 400400

The Premier Diva Growth Plan – Limited Editions No 19 is a capital-protected product linked to the performance of the Barclays Global Investors Diversified Alpha Fund 1, a fund of hedge funds.

ABG International (Isle of Man) investment consultant Julian Melling feels absolute return products are becoming more popular and says clients who want to avoid volatility as the recovery gets underway now have access to hedge fund products. He says: “The Diva product allows clients access to a hedge fund environment with the benefit of capital security, which provides some peace of mind. The fact that Diva is investing into a fund of hedge funds means that clients are not reliant on a single manager or hedge fund style.”

Melling likes the fact that the underlying fund of hedge funds is managed by Barclays Global Investors, which he regards as a well known manager with institutional experience. He also thinks the use of an independent risk manager, Evaluation Associates Capital Markets (EACM), is a good idea. However, he complains that there is not enough information in the literature about EACM.

Looking at the drawbacks of the product Melling questions whether a fund that is designed to produce absolute returns requires capital protection. He adds: “There is only a 70 per cent participation in the underlying fund with the Diva product. The literature is quite bare and would benefit from more information concerning the hedge fund strategies and Premier&#39s partners.”

Melling thinks competition will come from products such as GAM diversified IV which offers a 100 per cent participation rate and the Close Man hedge fund.

BROKER RATINGS

Suitability to market: Good
Investment strategy: Good
Charges: Average
Adviser remuneration: Average

Overall 7/10

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