September 23, 2013

Top Portfolio Products: Goldman Sachs Adds Real Return Fund

RiverPark and Morgan Creek Capital Management launch hedged products, as Allianz rolls out an indexed variable annuity

New products introduced over the last week include a real return fund from Goldman Sachs Asset Management and an open-end mutual fund from RiverPark.

In addition, Morgan Creek Capital Management launched an open-end alternative fund and Allianz Life offered a new indexed variable annuity.

Here are the latest developments of interest to advisors:

1) Goldman Sachs Asset Management Launches Real Return Fund

Goldman Sachs Asset Management announced the launch of the Goldman Sachs Multi-Asset Real Return Fund (GHRAX), which it says should help investors access to a multi-asset class solution that seeks to help individuals achieve real return over inflation.

GHRAX provides exposure to inflation-sensitive asset classes, including opportunistic fixed income, commodities and select equity sectors. This diversified strategy seeks to perform well across most market environments, and specifically, seeks to provide real return during periods of rising and high inflation.

Samantha Davidson, Raymond Chan, and Chris Lvoff from GSAM’s global portfolio solutions team are GHRAX’s co-portfolio managers. In addition to A shares, the fund is available in C, I, R and IR shares.

2) River Park Introduces RiverPark Structural Alpha Fund

RiverPark Advisors, LLC announced recently that it has launched the RiverPark Structural Alpha Fund (RSAFX, RSAIX),a new open-end mutual fund that seeks to give investors exposure to the broad-based equity markets while limiting downside risk and volatility by investing primarily in highly liquid global index options. The fund was initially made available to investors on July1.

The RiverPark Structural Alpha Fund is a conversion of a hedge fund called Wavecrest Partners Fund I, which was launched in September 2008. Justin Frankel and Jeremy Berman, who founded Wavecrest and managed the fund, have joined RiverPark and will continue to manage the fund in its new mutual fund format.

3) Morgan Creek Capital Management Launches Open-End Alternative Fund

Morgan Creek Capital Management recently announced the launch of its first open-end alternative mutual fund, featuring a broadly diversified global portfolio, actively managed utilizing a multi-asset class investment strategy with daily liquidity. The Morgan Creek Tactical Allocation Fund (MIGTX, MAGTX) will express Morgan Creek’s views on global asset allocation through a number of asset classes including equities, fixed income, currencies, commodities and cash.

The investment objective is to provide long-term total returns while utilizing a strategy that seeks lower volatility than a traditional portfolio of equities and fixed income securities. The fund will incorporate a broad set of global strategies across asset classes, geographies and sectors, including directional as well as long-short strategies.

4) Allianz Life Launches New Indexed Variable Annuity

Allianz Life Insurance of North America recently announced the launch of Allianz Index Advantage, a new indexed variable annuity (IVA) that aims to offer a balance of growth potential and some downside protection. It provides flexibility through two different strategies, the index performance strategy and the index protection strategy, and also includes built-in death benefit protection.

Unlike variable annuities with guaranteed minimum accumulation benefits that require waiting periods of up to 10 years, the new product provides the opportunity for benefits to be protected every year. Compared to fixed index annuities (FIAs), the IVA increases the amount of return potential by having much higher limits (or caps) on the interest credit coming from the growth of an equity index in exchange for less protection.

IVAs, according to Allianz, offer protection from the first 10% of losses per year versus guarantees of no losses from a traditional FIA, although some IVAs will offer that option in exchange for less upside potential. This is a fundamental shift for accumulation choices among variable annuities.

Read the Sept. 13 Portfolio Products Roundup at ThinkAdvisor.

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