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Enumerate
11-11-2010, 09:01 PM
An absolute return fund is typically a type of hedge fund aiming to perform positively independent of market direction (up, down, sideways).

These funds contrast the relative returns of long or short equity funds which aim to perform in only one type of market.

Celsius (CEI) was an example of a single strategy hedge fund. They effectively put an option "collar" on large cap dividend stocks - took a bit of leverage to increase the margin they were making on these dividend returns. The Trustee pulled the plug on them and they have paid out NTA (they were trading at a substantial discount to NTA).

Searching for a new home for these funds ... I found a very interesting ASX listed hedge fund recovery situation. (Trading at 60% of NTA; returning 15% on capital; paying dividends at 15% of trading price). Signature Capital Investments (SGI.ASX). This fund has a "fund of funds" strategy.

Does anyone have any beaten down hedge funds, with recovery prospects, that they follow? (ASX or NZxX - these are really income producing investments - in the "spirit" of NZDX).

Anyone have any insight into Signature?

Enumerate
12-11-2010, 02:27 PM
SGI update.

NTA has dropped to $0.39 per share with payout of the 5cents per share dividend, the DRP placement and (presumably) the unfavourable AUD/USD cross rate.

Last trade at $0.29 per share.

1$NZ buys 1$AUD of fund assets.