GAM has launched a fund focusing on mortgage-backed securities, managed by the recently hired Gary Singleterry and Tom Mansley.
Singleterry and Mansley joined the firm in June when GAM acquired US mortgage and asset-backed securities specialist firm Singleterry Mansley Asset Management.
The Star MBS Total Return fund will focus primarily on agency and non-agency US MBS and has been launched as a Ucits structure.
Open to retail investors the fund, the initial charge of the fund is 5 per cent and the annual charge is 0.8 per cent.
Within the current environment he fund is aiming to deliver returns of the three-month Libor rate +4 to +6 per cent per annum.
Mansley says: “The US market for mortgage-backed securities has been in a slow recovery mode over the past six years. It constitutes a highly liquid, diversified market with $7trn in assets and accounts for more than 30 per cent of the US fixed income market.
“Our experience shows that the asset class is suited to virtually every stage of the economic cycle. We believe that in addition to careful security selection and portfolio construction, the key to successful investing lies in anticipating and positioning for changes in the interest rate, prepayment and credit environment.”