(Reuters) – Castle Alternative Invest (CASN.S), a Swiss-listed fund of hedge funds, plans to list in London to improve the liquidity of its shares, its investment manager LGT Capital Partners said on Tuesday. The fund, which has assets of more than $500 million and which is on a discount to net asset value of 27 percent, will list its shares in London from June 5. The shares will be traded in U.S. dollars.
“In Europe the LSE (London Stock Exchange) has become the principal source of liquidity and visibility for listed alternatives,” said Mark White, general manager of LGT Capital Partners (UK).
Funds in London’s listed hedge funds sector are on an average discount of 19 percent, which White attributes to selling by private client wealth managers, but he said he expects discounts to narrow.
“Given the degree of stress that financial markets have been suffering… I expect to see discounts in general in the sector respond to the greater confidence coming back into the system.”
He said the firm, which also manages the Castle Private Equity (CPE.S) fund, would like to launch other funds in the future, although it had no immediate plans.
“The managed futures programme LGT is running… is a very good example of what we might want to do a dedicated vehicle around in the fullness of time.”
LGT had planned to list Castle Alternative’s shares in London towards the end of last year but delayed the decision because market conditions were so poor.
At end-March the fund was invested in strategies such as equity long/short, event-driven, relative value, macro and managed futures. (To read the Reuters Hedge Fund Blog click on blogs.reuters.com/hedgehub; for the Global Investing Blog click here) (Reporting by Laurence Fletcher; Editing by Hans Peters)