ARCH cru Investment Portfolio

by admin on 15 April 2008

Fund Legal Name: CF Arch cru Investment Portfolio

Manager: Arch Financial Products

Initial Charge: 6%

AMC: 1.3%

Launch Date: 07 May 2005

IMA Sector: Cautious Managed

Aim: CF Arch Cru Investment Portfolio is a multi-asset open-ended investment company that targets consistent returns with a significant focus on risk management. The Fund invests in both public market securities (equities, bonds, real estate) and private investments. Because of the risk techniques employed and the total return mindset, the Portfolio has generally low correlation with traditional public investments such as bonds and equities. The fund has a target return of cash + 4% per annum.

Commentary: The vast majority of fund managers have suffered during the last 3 months, with all major public asset markets (equities, property, bonds and credit) registering significant declines. However, based upon the Portfolio’s diversified exposure to private assets and markets, its returns have continued to move forward at a steady pace, achieving a return of 1.90% for the year to date.

In terms of performance, this Fund remains a top performer in the Cautious Managed Sector. In addition, it continues to record extremely low volatility relative to other managers in the Cautious Managed sector. As such, this Fund remains an excellent alternative to cash-based and bond-based investments and is an excellent diversification for those investors with significant public market investments.

It has recently been reported that pension funds are increasing their exposure to alternative asset classes, such as private equity, to compensate for having lower equity content in recent volatile markets. Indeed, UK pension funds have doubled their investment in alternatives from 0.8% to 1.6% in 2007 to enhance returns whilst reducing their correlation to equity markets.

Last week the ARCH cru Investment Portfolio came under criticism in Citywire due to concerns regarding the amount of off market private equity holdings. ARCH value their private equity investments regularly as per the British Venture Capital guidelines.

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The Featured Fund reviews are provided by Laura Firth.

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