One Of Europe’s Largest Hedge Funds Plans The Marshall Wace Tops Global Alpha ETF

marshall-wace“Marshall Wace, one of Europe’s largest hedge funds, will today unveil plans to launch a publicly listed exchange-traded fund to track its flagship Tops fund strategy in an effort to rebuild assets after large redemptions in 2009. The move marks a rekindling of a trend among top-tier hedge funds at the height of the boom to list versions of their restricted, proprietary strategies on stock exchanges. The Marshall Wace vehicle, expected to raise $500m (£307m), will be structured as an ETF, the first such structure of its kind and, unlike a closed-ended listing, will be able to grow according to investor demand,” Sam Jones Reports From Financial Times.

Jones Continues Saying, “The fund, to be named Marshall Wace Tops Global Alpha, will be listed on both the London and Frankfurt exchanges. It will track an index designed to mirror the holdings of the six existing Marshall Wace Tops funds, proprietary hedge fund strategies only available to institutions and wealthy individuals. For Marshall Wace, offering its strategy via an ETF is a potentially attractive way of scaling its operations swiftly after suffering, like many peers, from client redemptions after the collapse of Lehman Brothers.”

“At its peak in early 2008, Marshall Wace managed $15.8bn, but it has seen that shrink to $5.1bn. Although the cost of running the Marshall Wace ETF itself for investors will remain small at 0.25 per cent annually, the underlying structure it tracks will carry a 1.5 per cent annual charge and 20 per cent performance fee. Marshall Wace expects the structure to return 8-10 per cent annually to investors, with very low volatility, potentially making it very attractive,” Jones Reports.

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