CrossBorder set to launch Ucits fund

CrossBorder Capital is to launch a Ucits version of its market neutral Pulsar Alpha fund.

The Pulsar Global Alpha Ucits fund will be domiciled in Dublin. It is expected to launch in March 2010.

The Cayman Islands domiciled Pulsar Alpha fund has generated annualised returns of 14.31% since inception in August 2005, with volatility of 8.15%.

The fund is permanently short the MSCI World Index and takes long positions in the regions and industry sectors highlighted by CrossBorder's asset allocation research. The long/short fund invests in indices and ETFs and holds no individual stock positions. CrossBorder said it aims to create pure alpha with no beta exposure.

Investment decisions are based on CrossBorder's research into market liquidity. The company uses models to predict market turning events by analysing data from a range of sources, including central banks, stock exchanges, banks and the IMF.

"We have demonstrated over the past two decades that our liquidity research model works. We have a huge amount of data that enables us to link liquidity and the future performance of various asset classes," said CrossBorder Capital CEO Michael Howell.

CrossBorder said its Pulsar Global Alpha fund will be one of the first market-neutral ETF-based Ucits funds.

Howell said CrossBorder was bullish about the US equities and the dollar in the short- to mid-term, with emerging markets seen as a strong play over the longer-term.

Howell said: "Our analysis of historical data and the actions of central bankers in previous decades suggest that China, the US and others will introduce quantitative tightening earlier in 2010 than many analysts expect, in response to fears over commodity inflation.

"I think we will see a large-scale jump in US corporate profits in the first half of this year too. The combination of the two will see investment flows heading back towards the US in 2010 and propel the dollar higher through the year.

"Historically, a rising dollar has had a negative effect on emerging markets. We are therefore expecting a correction of 10-15%. This puts us in the unusual position of saying that one of our favourite long-term asset classes will underperform in 2010. But when that correction has taken place we will see it as a buying opportunity."

The Pulsar Global Alpha Ucits fund is expected to have a 2% management fee and 20% performance fee. The minimum subscription will likely be £10,000.

The fund will offer weekly liquidity.

Based in London, CrossBorder Capital has over $250 million assets under management across its five existing fund vehicles.