FINANCE NEWS: First charity hedge fund nets 12% after debut trading year

The first hedge fund for charities to be authorised by the Charity Commission posted a return of more than 12 per cent during 2003.

The Absolute Return Trust for Charities, launched by Cazenove Fund Management in January, 2003 looks after more than £60m of charity monies.

But the trust, authorised as a Common Investment Fund by the Charity Commission, performed less well than charity investments as a whole last year. According to performance analyst the WM Company, the average charity fund grew by 17.5 per cent during 2003.

But Cazenove said the trust is intended to reduce volatility, rather than achieve huge returns.

Cazenove says that it took in around £60m of new charity money in 2003, and another £50m already this year.

John Gordon, Cazenove's head of charity client service, said: "The growth is testament to the credibility accorded to our approach to investing.

Our innovative use of alternative investments and equity income means that we can address the needs of our charity clients."

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