Transamerica Launches Global Equity Long-Short Fund
By DailyAlts Staff Global equity long/short funds offer investors a ready-made portfolio of “long” (owned) and “short” (sold-short) stocks from all over the world. These funds can generally serve a core or satellite role within a diversified investment portfolio. Most long/short equity funds have long-term capital appreciation as their primary objective, with downside protection as a natural secondary benefit. What separates these funds are the strategies they employ in pursuit of these objectives, and the skill of the managers employing them. Sub-Advised by Picton Mahoney On November 30, Transamerica launched its own global long/short mutual fund: the Transamerica Global Long/Short Equity Fund (MUTF: TAEAX ). The fund is sub-advised by Picton Mahoney Asset Management and overseen by Michael Kimmel and Jung (Michael) L. Kuan, a pair of CFA portfolio managers from Transamerica. The managers combine quantitative and fundamental analysis in the fund’s investment process. Under normal circumstances, the fund will have 25% to 75% net-long exposure to the global equity market. Its investments may include common stocks, convertible securities, REITs, and rights and warrants for the purchase of common stocks and other equity investments. The fund may also employ options strategies, including but not limited to covered-call and put writing, to increase income. Fundamental, Factor-Driven Approach Picton Mahoney employs fundamental research and quantitative models to generate ideas for long and short positions, and then uses a multi-factor model that emphasizes fundamental change, valuation, growth, and quality. Up to 20% of the fund’s net assets (including long and short positions and derivative exposure) may be invested in emerging market securities. In addition, the fund expects to have approximately 25-75% net long exposure to the global equity market. Shares of the new fund are available in two classes: A (TAEAX) and I (MUTF: TAEIX ). The management fee on both share classes is 1.00%, while the respective net-expense ratios are 3.89% and 3.64%. The expense ratios include 2.09% for dividend and interest expense on short positions, which is an expense of running a long/short portfolio. The respective initial minimum investments for each share class are $1,000 and $1 million. For more information, view a copy of the fund’s prospectus .