Credit Suisse has announced plans to change its multi-manager range, including the relaunch of its Global Bond fund as a Multi Asset Distribution portfolio.
The European, Japanese and North American funds all will merge into the firm’s International Growth portfolio, while Asia Pacific will be combined with the Emerging Markets fund.
The announcement follows a strategic review of the company’s fund range. The changes, subject to investor approval on August 10, take effect at the end of August. Graham Duce, co-head of Credit Suisse’s multi-manager team, says the multi-asset fund will follow a model the company created for its private banking division at the start of 2006.
Duce joined Credit Suisse’s retail multi-manager team from the private banking side earlier this year, after the departures of Gary Potter and Robert Burdett to Thames River Capital. He says: “We want to roll out the model into the retail space. More investments are coming to the market with yield, and all of the components in our fund pay income.”
The portfolio will pay quarterly income with a target gross annual yield of more than 5%, a mark Duce is confident of hitting. To achieve this, the fund will have exposure to a range of asset classes.
Credit Suisse expects a 20-40% weighting in fixed interest, 20-30% in protected equity, 10-30% in equity income, 0-20% in overseas equity, 5-15% in property, 5-15% in alternatives and 0-10% in cash.
Within the alternatives allocation, hedge fund exposure will come from Acencia, a fund of debtorientated hedge funds registered in Guernsey and run by Martin Gross.
The Credit Suisse portfolio will also hold a stake in 3i Infrastructure, which raised £700m earlier this year. The fund will not have exposure to commodities at launch, but Duce says there is an investment “on the radar” in this area.
He says the fund will use Global Bond’s current assets – about £13m – in addition to “a healthy amount of money” from the private bankingdivision.
The charging structure of all the affected funds will remain the same and Credit Suisse will meet the costs of the changes.