Advisers have given a lukewarm response to plans from Skandia Investment Group to bring out a multi-manager alternatives fund.
The fund is a designed to be a diversifier to traditional asset classes, with low correlation to equities, bonds and property.
The 10 asset classes at launch are likely to be diversified hedge fund exposure, listed timber, precious metals, listed metals, listed infrastructure, hard and agricultural commodities, active currency management, global macro strategy, long/short equity strategy and volatility. Each asset class will be outsourced to an individual manager.
Chelsea Financial Services managing director Darius McDermott says the fund offers diversification but lacks a true multi-asset approach.
He says: “The impression I get is that it is 50 per cent hedge funds and 50 per cent other strategies which may work but I am bit cautious on the fact that it lacks traditional equities, bonds and property asset classes. I struggle to see which advisers it will look to appeal to.”
Wilson Dean Financial Services director Nick Lincoln says: “I can see the benefits of pulling together all these alternative assets to lower the risk in a complete portfolio but I would still like to see it in action for some time in these markets before I made any investment.”