UK-listed fund offers Australian share class

Andrew Gale

Australian investors can now benefit from investing in a new Australian dollar share class on the London Stock Exchange through fund of hedge funds, Dexion Absolute.

The close-ended fund can be traded daily, offering liquidity to Australian investors through their own currency.

Dexion Capital launched the fund in December 2002 and uses Harris Alternatives, owned by Ixis Asset Management Australia, as the underlying investment’s manager.

In a multi-currency share issue that closed last week, Dexion Absolute raised an aggregate $US435 million, which included 70,672,500 Australian dollar shares, making it the largest issue in the fund’s history.

Ixis managing director Karyn West explained the advantages of investing through your country’s own currency.

“If you want to get (a target return of) nine or 10 per cent it needs to be in your currency otherwise your likely return is going to get buffered around by interest rate movements,” she said.

“If you invest in a US or Sterling share class you could actually have a completely different type of return because of the different currency.

“So once you do an Australian share class and the whole investment is hedged you’ve got more certainty about getting your target return.”

Dexion Capital director Andrew Gale said the fund was available to retail institutions, but uniquely at an institutional fee level.

“When we chose Harris, it was all about picking the best manager and providing it in a nice attractive package which big institutions and smaller institutions can buy — whether you’ve got $10 million to invest or $10,000, you will end up paying the same fees,” he said.

Apart from the newly launched Australian dollar share class, Dexion Absolute also features share classes in Sterling, US dollars and Euros.