UK – Asset manager F&C, which this week announced the departure of chief executive Howard Carter, says its Citrine hedge fund could go to €1.5bn.
The F&C Citrine Fund this week opened for new investment with a specific focus on institutional investors and hedge funds of funds.
The fund was initially launched in May 2004 by the single strategy hedge fund arm of F&C Asset Management. It will pursue a pan-European equity long/short strategy.
According to F&C Alternative Investments director Alex Ingham Clark, the fund has only been opened now because: “We first wanted to run the thing, bed it in, open a track record and then open it up to investors.
“Essentially today is the first day we’ve put our heads above the parapet and said, ‘Look, this is what we’re doing’,” he said at the launch.
Citrine fund manager and Alternative Investments director Frédéric Desage-Bonnet emphasised the low risk of the fund.
The firm is expecting substantial growth. “We are planning to raise €250m to €300m initially, although we believe the fund can be much larger, said Desage-Bonnet. He pinned the fund’s capacity at between €1bn and €1.5bn.
According to F&C, the Cayman-domiciled fund has a target absolute yearly return of between 10% and 12% with a target Sharpe ratio above 1. “Over the past year the fund is up 11.47% and has a Sharpe ration of 3.7,” said the press release.
“F&C Citrine has met its return expectation with much lower levels of risk than the typical fund in the peer group which is why we believe this vehicle will prove particularly attractive to institutional investors,” said Ingham Clark.
The opening of the Citrine fund is regarded by F&C as an “important development” in its bid to become a big institutional hedge fund provider.
“This fund raising is an important development for the business because it demonstrates our commitment to build upon our existing presence in the derivatives-based hedge fund arena into one of the more ‘mainstream’, and highly competitive segments of the hedge fund market,” said Ingham Clark.