Pure Capital offers targeted negative correlation
Pure Capital, a New Zealand-based quant hedge fund manager, has launched a new open ended fund which aims to provide protection similar to a structured product but make money in both rising and falling markets, replicating the standard strategy adopted by most hedge funds.
The Pure Protection Fund will start trading on July 1 (2009) and give investors exposure to targeted negative correlation on listed equity index and commodity markets in bear environments, and targeted positive correlation in bull markets.
It uses a rules based approach to create a strategy which aims to generate positive returns out of market trends, generating returns by layering short trades in a bear market or doing the reverse in a bull market.
In addition, partial protection against gap risk
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