Rubicon has launched an investment platform comprising of two Australian unit trusts that provide access to a range of global hedge funds, utilising an entirely performance-based remuneration structure rather than management fees.
The Rubicon International Leaders Fund and the Rubicon International Leaders Enhanced Fund allow investors to select an individual exposure to global hedge funds of 100 per cent and 300 per cent respectively. The enhanced fund uses leveraging to allow a customised level of exposure of up to 300 per cent.
Gordon Fell, managing director of Rubicon, said the decision to use a performance-based rather than management fee structure was made in response to widespread criticism of management fees in recent years.
“We have addressed [the fee issue] by eliminating the management fee and replacing it with a performance-based fee.
“We will only be paid if investors are making money, totally aligning our returns with those of investors,” he said.
Fell estimated that this fee structure equates to a saving of around 1.4 per cent per annum relative to management fee-based funds.
Both funds have received favourable feedback from research firms Standard & Poor’s (S&P) and Aegis Research.
In awarding both a four star rating, S&P highlighted the innovative fee structure and strong working relationship between the investment adviser, Tiedemann Trust Company, as key features.
Research house Aegis has awarded the funds a ‘highly recommended’ rating in recognition of the comparatively low fees, alignment of management interests with investors, customisation and monthly liquidity.
