Traded Policies Fund attracts $38m from investors opting for steady, positive returns

Managing Partners Limited, the boutique fund manager, has seen substantial interest in its Traded Policies Fund this year, with most investment coming from institutions across Europe, including five of the world’s top 20 banks by asset value.1 Pension funds, insurance companies – including five of the UK’s top 10 life offices – and continental banks selling to retail clients all list among the institutions now investing in the fund.

The fund had a total $138m in assets under management at 15 September, with $58m being raised so far in 2008. The fund invests in traded life policies, which are United States-issued whole of life assurance policies sold before the maturity date to allow the original owner to enjoy some of the benefits during their lifetime. TLPs are purchased at a discount from their maturity value, which in the majority of cases is fixed at outset, which means that they are guaranteed to rise in value. The TLP market has seen huge growth from $50m in 1990 to $20bn in 2007.

Jeremy Leach, Managing Director of MPL, said: “Investors have been forced to look at alternatives to equities after more than a year of declining returns. The volatility just keeps continuing and investors do not see any indication of when that will end. In such circumstances, an asset class that offers the prospect of steady annual returns of circa 8-10% per annum year-in, year-out is impossible to ignore.”

While TLPs carry the risk that it is unknown when the lives assured will die, the exact pay-outs are known so the key attraction of a TLP fund is that with the right diversification and actuarial analysis, they can be used to deliver steady, predictable returns.

For institutional investors, MPL offers US dollar, Euro and sterling share classes in its Traded Policies Fund, which have returned 9.01%, 9.49% and 10.02% respectively, net of charges, over the 12 months to 1st September 2008.

Retail investors can invest in Sterling, Euro and Dollar Growth share classes in the Traded Policies Fund, which have returned 9.78%, 10.46% and 9.53% respectively over the 12 months to 1st September 2008 net of charges.

For further information, please visit the website: www.managing-partners.com.

Published on 01 Oct 2008 at 05:26 pm