Novare, a financial services group in South Africa, has launched two retail fund of hedge funds, the Novare Equity Long/Short Retail Fund of Hedge Funds, and the Novare Low Equity Long/Short Retail Fund of Hedge Funds.

Novare hedge fund suite now consists of five retail hedge funds, providing clients with greater choice and flexibility.

Eugene Visagie, Head of Hedge Fund Investments at Novare, said: “When constructing a hedge fund portfolio the variety of funds enable clients to tailor their investments even more and in so doing achieve their individual investment goal(s).”

The Novare Equity Long/Short Retail Fund of Hedge Funds has an aggressive risk/return profile.

It is a fund of retail hedge funds that invests in retail hedge funds from South Africa, predominantly the equity long/short strategy.

It targets a return of CPI + 5% after fees over the long term, whilst also targeting lower returns volatility than the FTSE/JSE All Share Index over three years.

The Novare Low Equity Long/Short Retail Fund of Hedge Funds has a moderate risk/return profile.

It is also a fund of hedge funds that invests in retail hedge funds from South Africa. Its predominant focus is on funds with low beta equity long/short and equity market neutral strategies.

“The funds are similar in their targeting of lower volatility, with the first option being more aggressive in its approach than the second,” said Visagie.

Both funds can be accessed through either a minimum R50,000 lump sum investment, or R1,000 per month.

Prior to the launch of the latter two funds, the Novare Fixed Income Retail Fund of Hedge Funds was introduced in June, joining the Mayibentsha Growth Retail Fund of Hedge Funds and the Mayibentsha Defensive Retail Fund of Hedge Funds.  

Visagie said that with traditional asset classes not delivering the growth investors are looking for, interest in hedge funds is on the rise.

"Although we expect the space to become more competitive as new retail hedge funds enter the market, we remain committed to staying ahead of the curve in terms of our offering,” he said.