TORONTO (HedgeWorld.com)–BluMont Capital Corp. launched a multi-manager, multi-strategy principal guaranteed hedge fund, BluMont Man Multi-Strategy Notes.
The notes are an extension of BluMont’s relationship with Man Investments,* London, which will manage the hedge fund portfolio in the notes using its Man Multi-Strategy Guaranteed Ltd. fund as the model. Man also helps manage the BluMont Man-IP 220 Series 1 and Series 2 notes, which together raised C$146.4 million (US$108.9 million) in assets this year .
BluMont is aiming for double-digit returns with volatility that is less than the equity markets for the ten-and-a-half year notes. The investments in the note fall into five categories: futures management, arbitrage, funds of funds, equity hedge and long/short equities.
Principal repayment is guaranteed by Citibank Canada through a swap agreement. The notes are leveraged, with each C$100 invested resulting in C$150 of investment.
A management and risk-transfer fee of 1% a year is charged on the Bermuda-domiciled notes, while Citibank will be paid 50 basis points a year for providing the swap that allows the principal guarantee to be put into place, according to the offering document.