NEW YORK (HedgeWorld.com)–OppenheimerFunds is offering access to Tremont Partners Inc.’s* hedge fund of funds approach to a wider group of investors through two closed-end funds that each requires only a US$50,000 minimum investment.
The Oppenheimer Tremont Market Neutral Fund LLC and the Oppenheimer Tremont Opportunity Fund LLC both aim for absolute returns regardless of the direction of general markets.
“Retail investors have lacked access to hedge funds for too long,” said John V. Murphy, president and chief executive of OppenheimerFunds, in a statement. “These are breakthrough products, bringing the benefits of alternative investing to a whole new class of investors. We believe the Oppenheimer Tremont Hedge Fund Series will hold strong appeal for investors seeking portfolio diversification through all market cycles.”
Both of the new funds will employ Tremont’s approach to hedge fund of funds investing. The funds will be allocated among a number of different fund managers and/or strategies in an effort to diversify risk and decrease the volatility usually associated with a single manager fund.
Tremont identifies strategies it believes most likely to achieve return objectives and provide unique value to the portfolio using a multi-step evaluation process that includes analysis of risk/return profiles, market correlation and downside risk objectives. Market environments, strategy weightings and managers are continually monitored, according to an Oppenheimer released statement.
The funds were offered to the public in January. The first offer to repurchase interests of the funds will be as of Dec. 31, and after that March 31 and September 30 of each subsequent year. Each fund has now more than US$25 million in assets. Oppenheimer has made an investment in both funds, a spokesman said.
Oppenheimer is charging a one-time sales charge of 2.5%. The annual management and administrative fees are 2.15% for the market neutral fund and 2.35% for the opportunity fund. An incentive allocation fee is also charged (5% for the market neutral and 10% for the opportunity fund) that is paid to the investment adviser out of the net profits over and above a pre-determined hurdle rate.
*Tremont Partners is owned by Tremont Advisers Inc., Rye, N.Y., which is a minority investor in and strategic partner with HedgeWorld.