Forum Archive Index - May 2002

["Rein Purre" <purres@paradise.net.nz>]

Hi John
The OM-IP Series 7 is the latest edition of a series of funds dating back to
the early 90's.
It is a Fund of Funds investing in a basket of global hedge funds and most
of the previous series have done very well. They are set up for a 10 year
term, but there are some early buyback facilities. They are relatively
unusual for high potential return investments in that they have a racheted
capital guarantee from Westpac in Australia which ensures return of capital
after 10 years, plus it locks in a portion of any gains made over the years
(after any losses have been made up).

Usually you have to risk a capital loss to get potential gains of 20% p.a.
but in this case your risk is: what will the actual return be and the
opportunity and inflation cost if you only get your capital back after 10
years.

Hedge fund investments are best considered from an overall portfolio
perspective where there is lots of evidence that an investment of c.10% of a
portfolio in hedge funds will increase returns and lower volatility because
hedge funds have a very low correlation with share, bond and property
markets.

The Yeti




----------------------------------------------------------------------------
To remove yourself from this list, please use the form at
http://www.sharechat.co.nz/chat/forum/