NEW YORK (HedgeWorld.com)–After a long registration process, Deutsche Bank is finally able to talk publicly about its hedge fund of funds offering for individual investors.
Deutsche Bank’s hedge fund unit DB Absolute Return Strategies is now offering its first registered hedge fund of funds to a broader population of eligible individual investors.
The DB Hedge Strategies Fund LLC is a closed-end fund registered under the Investment Company Act of 1940 with a prospectus filed under the Securities Act of 1933. The investment unit is one of a handful of hedge fund managers that have registered a fund under the 1933 Act, which allows Deutsche officials to more freely discuss the aspects of their fund, since it is offered publicly under the act.
“We believe hedge funds should be part of every investors’ portfolio,” said Craig Russell, managing director and global head of sales and marketing at DB Absolute Return Strategies.
The hedge fund group, which has US$5.5 billion in assets under management, plans to raise US$500 million in initial fund assets. The fund registration process took about a year and a half to complete and included a name change and the dropping of the incentive fee.
The fund’s investment objective is to seek attractive risk adjusted returns with the added benefit of lower volatility in a fund of funds structure. Between 15 and 40 hedge fund will use a variety of absolute return strategies, and now more than 10% of the fund’s assets will be allowed in any one particular hedge fund.
The investment minimum is US$50,000, and the fund is open to accredited investors. Eligible investors also include those that have an account managed by a registered investment adviser that is subscribing for units in a fiduciary capacity on behalf of the account. Fees include a 3.5% maximum placement fee.
Scudder Distributors Inc and Deutsche Bank’s private bank and DB Alex Brown are distributing DB Hedge Strategies. Deutsche is in discussions with other intermediaries on other distribution channels for the registered fund.