- European equity strategies dominate UCITS platforms
by strategy – indicating that other strategies are
- Asian and US fund managers are responding to investor
demand to launch UCITS funds and are using platforms as an
entry point into the European market
- Platforms offer hedge fund managers access to investors
outside their traditional institutional investor base
- Platforms are expected to grow in line with the wider
absolute return UCITS sector
London, 4 January 2012 – Assets on
platforms account for about $9 billion at the end of June,
representing 8% of the entire absolute return UCITS sector
which comprised $116 billion at the same point.
Platforms designed to facilitate the launch, distribution
and management of UCITS funds are typically offered by
investment banks or established fund management companies,
although there are also now a number of independent players.
Platforms are particularly attractive to hedge funds that do
not have extensive distribution networks and infrastructure
teams of their own. All the existing ones are domiciled in
either Ireland or Luxembourg, with the exception of
German-domiciled Universal Investments (UI). The majority of
these UCITS platforms were launched in the aftermath the global
financial crisis in 2008.
Since inception, the platform industry has developed into a
one-stop-shop solution, offering traditional offshore alpha
generators access to fund governance, administration and
custody services. Most platforms also offer capital raising
Absolute UCITS, part of HedgeFund Intelligence, undertook
the most comprehensive survey of the platform UCITS industry at
the midpoint of 2011.
There have been a number of notable recent platform launches
– including from Goldman Sachs and Lyxor Asset
Management – and other financial services firms are
planning on unveiling similar offerings next year.
Most platform service providers have their main offices or a
significant presence in London – again with the
exception of Frankfurt-based UI. The largest UCITS platforms,
by assets, are investment banks Merrill Lynch Investment
Services (MLIS) and Deutsche Bank Platinum, followed by asset
manager platforms Alceda and Schroder GAIA.
UCITS platforms ranked by absolute return assets
All of the top five platforms, by assets, also have an
absolute return UCITS fund represented in the top five flagship
funds on a platform.
The largest fund on a platform is DB Platinum IV dbX
Systematic Alpha Index Fund – a CTA strategy that uses
Winton’s Diversified Trading Program. It had
assets under management of $1.3 billion at the end of June.
Aquila Capital’s AC Risk Parity 7 Vol Fund
– a $1.1 billion strategy that sits on the
Aquila-owned Alceda platform – is the only other UCITS
fund on a platform that had assets of more than $1 billion at
June 2011. Together with a more high-vol version, the strategy
had total assets of $1.5 billion.
The third-largest fund is the MLIS York Event-Driven UCITS
Fund, which had assets of $970 million and is the largest fund
on the MLIS platform.
Joy Dunbar, Editor of Absolute UCITS, comments: "UCITS
platforms have become a valuable tool for fund managers who
want to diversify their investor bases but do not have
significant distribution networks or European-based offices. We
are sure that many more will follow in seeing platforms as way
of gaining an edge in an increasingly competitive environment
for asset raising.
"It will be interesting to see how service providers who did
not launch a platform develop their offerings in response to
the growing absolute return UCITS space."
About Absolute UCITS:
Absolute UCITS is an only-online source of must-know
information for the global fledgling absolute return UCITS
space. The website is part of HedgeFund Intelligence
– the leading provider of news, analysis and
performance data on the global hedge fund industry.
For more information, please contact:
Editor, Absolute UCITS
Tel: +44 (0) 20 7779 7358
Toby Bates / Del Jones
+44 (0) 20 7726 8400
Walek & Associates:
+1 212 889-4113 / firstname.lastname@example.org
Walek & Associates (Hong Kong)
+852.2273.5102 / + 852 6112 7553