Set to launch in November, The Rudolf Wolff (Onshore) Income Fund Limited will aim to deliver a target return on income of 5 to 7% gross per annum plus capital appreciation. It will be managed by Bruce MacDonald, who has run Rudolf Wolf’s Bermuda-domiciled flagship Ucis fund since December 2011.
The strategy invests in a weighted portfolio of income bearing financial instruments, including Permanent Interest Bearing Shares (PIBS) issued by UK building societies, including Skipton, Nationwide and Yorkshire Building Society. Bank bonds currently held include RBS, Investec, Abbey and Lloyds.
As at the end of June, the strategy was 100% in UK financial papers, with banks at 28.7%, insurance at 37.2% and building societies 30.7%.
The new fund will be available as two shares classes – a retail class with an annual management charge of 1.5%, and an institutional version at 1%. Minimum investment is £5,000, and the vehicle will carry a performance fee of 10% with a hurdle of 8% per annum.
Liquidity in the fund will initially be mid and month end with 10 business days’ notice to redeem prior to month end, though this may switch to weekly liquidity if the administers costs in not prohibitive.
The strategy is marketed as a low-risk investment for clients who are looking for higher returns than currency offered by standard building society or bank deposit accounts. However, MacDonald revealed that as the fund evolves, he may eventually look to evolve the portfolio to invest across any currency, including emerging market debt.
Next in the pipeline for Rudolf Wolff is a possible long/short global equity vehicle which would invest across 14 markets including Europe, the US and Japan. The firm is also working on a Cayman Island-domiciled vehicle to take advantage of opportunities in ETF futures.
About Rudolf Wolff
Rudolf Wolff dates back to the 1860s in London, when it was a German metals merchant, then known as Rudolf Wolff & Co. The company went on to become a founding member of the London Metal Exchange in 1877.Its most recent incarnation dates to around 2008, when it was re-launched by a team that inlcuded a number of the former management of an earlier entity and members of the family that originally founded it.
