Jupiter Asset Management is to launch a UCITS III fund for investors seeking to capture returns from investing in pan-European equities. The Jupiter European Absolute Return (Sicav), which launches in January, will seek to generate an absolute return independent of market conditions. In seeking to meet the objective, the manager will aim to limit volatility.
 
The Fund, a sub-fund of the Luxembourg-domiciled Jupiter Global Fund, will be managed by two of Jupiter's highly-regarded European fund managers - Cédric de Fonclare and Stephen Pearson. This marks the first time that the long/short investment capabilities of Stephen Pearson will be made available to investors in a regulated environment and combines his expertise with the proven long-only skills of Cédric de Fonclare.
 
Stephen has 15 years' experience as a long/short equity manager and 24 years' experience of investing in European equities. Prior to joining Jupiter in 2001, he worked for Sloane Robinson Investment Management for seven years. The Jupiter Europa Hedge Fund is an offshore long/short portfolio, managed by Stephen since inception in November 2001. It has delivered +55.5%, compared to an MSCI Europe TR index return of 3.9%. The Jupiter European Opportunities (Sicav), managed by Cédric since January 2003, has delivered a return of +70.8%, compared to the FTSE World Europe TR index return of 47.6%.* Cédric has over nine years' experience as a long-only manager of European equities and has won two gold medals in the Sauren Golden Awards 2009 'European Equities including UK' category.*
 
The managers' investment process will be based upon fundamental 'bottom up' stock-picking. Capitalising on their own experience of Pan European equity investing, using longstanding relationships with company managements and local brokerages, and exploiting the broader Jupiter infrastructure, they will look to build a portfolio of 50-80 long and short positions in individual companies in the European markets.   Directional exposure to the equity markets will therefore be more a function of decisions taken on individual companies rather than top down positioning based on macro economic views. Any residual unintended market or sector risk will be hedged using index derivatives or sector swaps.
 
The Fund will use limited leverage, have daily liquidity and make use of the wider investment powers allowed under UCITS III, for example using exchange traded futures and options for investment and risk management purposes. In these respects it will retain many of the advantages and flexibility of a hedge fund structure, but offer the additional benefits of daily dealing and a strong regulatory environment, making it more accessible to a wider universe of investors. A performance fee is payable on the Euro B class of shares which will be subject to a high water mark and be payable only when the Fund outperforms its benchmark (Euribor 3 month). This strongly aligns the interests of the managers with their investors**.
 
Cédric de Fonclare, fund manager of the Jupiter European Absolute Return Fund, said; "Europe is an exciting place to invest with diverse local and regional trends and variations. It is also home to large number of multi-national and global corporations. We think this variety makes for an ideal universe in which to run a Fund that can take advantage of both success and failure at the company level.''  
 
Stephen Pearson, fund manager of the Jupiter European Absolute Return Fund, said: "The high levels of market volatility in the last two years have demonstrated the benefits of funds that aim to offer smoother, steadier returns. I have worked with Cédric for the past eight years as part of the Jupiter European team and for the past year specifically on this project as we have brought it to market. We are both very excited about combining our skills on this Fund to the benefit of our investors.''
 
- ENDS -
 

 
Notes to Editors
* Source: Financial Express to 30.11.09. All figures in Euros
** Fees: 5% initial, and then investors can choose to either pay 1.75% AMC or 1.25% AMC plus a performance fee of 15% of the outperformance of the NAV per share over Euribor (3 month). A High Water Mark applies which requires the fund to make up any underperformance relative to the benchmark from previous years before any performance fee may be taken.
 
Key Points
Jupiter European Absolute Return Sicav is a UCITS III regulated product
Jupiter European Absolute Return Fund is a sub-fund of the Jupiter Global Fund Sicav
Managers: Cédric de Fonclare and Stephen Pearson
Regulated framework offers daily liquidity and increased transparency
Objective: To generate positive long-term returns across varying market conditions, principally from a portfolio of investments in European equities and equity related securities.
15 year track record in long/short and long only European equities
Diversification: normal range between 8 to 12 sectors and 50 to 80 stocks
Typical Net Exposure: -30% - +60%
Gross Exposure Limit: 200% (normal range 75% - 125%)
Benchmark against Euribor (3-month)
Expected launch date: 04.01.10, subject to regulatory approval
Launch date: 04.01.10 for institutional investment and, subject to obtaining relevant registrations, for retail investment.
Euro share class to be activated at launch
Minimum initial investment: ?1,000
 
NOTE
Jupiter Asset Management Limited (JAM) is authorised and regulated by the Financial Services Authority, for business conducted in the UK, and the registered address is 1 Grosvenor Place London SW1X 7JJ. The group is collectively known as "Jupiter". The above commentary represents the views of the Fund Manager at the time of preparation and may be subject to change, and this is particularly likely during periods of rapidly changing market circumstances. They are not necessarily those of Jupiter and should not be interpreted as investment advice. Past Performance should not be seen as a guide to future returns, the value of an investment and the income from it can fall as well as rise and may be affected by exchange rate variations. Every effort is made to ensure the accuracy of any information provided but no assurances or warranties are given.