GERMANY – Frank Russell Co. and Metzler Asset Management have made a “strategic alliance” under which Metzler will offer its clients Russell’s multi-manager hedge fund product.
The move follows proposals by the German finance ministry to relax rules on hedge fund investment.
“The aim of the co-operation is to offer a first-class hedge fund product for the German institutional market,” the two companies said in a statement.
“After completing a thorough due diligence we have selected Russell as they are the global leaders in multi-manager investing,” said Bankhaus Metlzer partner Norbert Enste.
Alison Ramsdale, managing director of partnerships and distribution alliances at Russell, said she expected the market to be “significant” – if the expected regulatory changes occur. She said the deal with Metzler was a “cooperation, a partnership a contractual relationship” under which Metzler would have the exclusive right to distribute to German institutions.
Russell spokeswoman Sarah Hodges said the deal included a sharing of revenue but declined to be more specific. She was not able to estimate the potential size of the client base. “We wouldn’t like to put a number to it.”
Russell’s Alternative Strategies Fund is a Dublin-domiciled fund that has had annualised returns of +9.4% since it was launched on June 1 2001, Hodges said. She would not comment on the current size of the fund.
Under the German government’s proposed Investment Law 2003, will let both domestic and foreign hedge funds to sell shares to both institutional and private investors in the same way.
Russell already has a relationship with Societe Generale’s Credit du Nord in France for the Etoile Alternative fund.
Russell manages around seven billion dollars of European institutional assets while Metzler runs around 5.5 billion euros of European pension fund assets.