Sagitta Asset Management has come up with an aspirin for the hedge fund market with the introduction of the salix fund.
Salix, which is named after the willow tree that provides the chemical for aspirin, is a hedge fund aimed at the high-net-worth investor who is looking for growth.
The fund will invest in different areas of the healthcare sector, including pharmaceuticals, care homes, biotechnology, medical instruments, hospitals and drug delivery, where a drug is changed from a liquid form into a powder or pill form. It will be run by either going long or going short on companies in these areas, depending on what is happening in the stockmarkets and what is affecting the healthcare sector.
Most of these companies will be based in America, as this is the leading area for biotechnology and pharmaceuticals at the moment. Some of the companies it will invest in will be Cambridge Antibodies, Novoste, which makes medical devices for the treatment of arteries and Scios, which has just developed a drug to treat heart failure.
The management team behind Salix are June Scott and Eduardo Tomacelli. Scott currently manages the Sagitta healthcare fund, which is an offshore unit trust domiciled in Dublin. She joined Sagitta in January 2001, having previously worked for Foreign & Colonial for six years. Tomacelli manages the Sagitta mariner hedge fund and joined the company in 1998.
Hedge funds are high-risk investments as they attempt to guess what is going on in the market and react to it. However, healthcare companies do have a degree of financial stability behind them which reduces the risk, as they need capital to develop drugs and market treatments.
According to Standard & Poors the Sagitta healthcare fund is ranked 3 out of 54 funds, based on £1,000 invested on a bid-to-bid basis with gross income reinvested over six months to September 10, 2001.