Morley celebrates one year anniversary of Fund of Hedge Funds

Article date: 30 July 2004

Aviva Alternative Funds - Alpha OptimumDelivers Twelfth Consecutive Month of Positive Returns

Morley Fund Management, one of the UK’s largest fundmanagers, today announced the one-year anniversary of itsLuxembourg-based fund of hedge funds, the Aviva Alternative Funds -Alpha Optimum. During a period of volatility for long-onlyinvestors and the wider hedge fund industry, the fund has justreported its twelfth consecutive positive return for investors.

Designed to produce steady returns that are independent of themovements of equity or fixed income markets, the fund has a zerobeta*, low volatility and has produced returns of 7.8%** [ineuros]. Aviva Alternative Funds - Alpha Optimum currently has fundsunder management of €134.96 million, attracting bothinstitutional and private investment.

Neil Smith, head of alternative investment at Morley FundManagement, said: "Aviva Alternative Funds - Alpha Optimum hasdelivered what we fully expected of it – a truly diversifiedmarket neutral fund that is delivering performance at a time whenmany other fund of hedge funds are delivering very modest or evennegative returns."

Total hedge fund assets in the UK have increased substantiallyin the last year, with institutional investors replacing high networth individuals as the main driver of growth. Concerned by theperformance of global equities during the last six years,institutional investors, particularly pension funds, have looked todiversify risk and enhance returns by investing in alternativeassets.

Neil Smith added: "Investment in a broad array of hedge fundstrategies means minimising the overall fund beta relative to theequity and bond markets. Our fund focuses on high quality andrepeatable alpha sources such as the exploitation of marketinefficiencies, under-analysed segments of the market and arbitrageopportunities."

*Beta is a measure of volatility i.e. the tendency of asecurity's returns to respond to swings in the market.

**Returns are based on Net Asset Value prices (euros). Source:Standard & Poor’s

-ends-

For further information please contact:
Fiona Baker, Head of Corporate Comms 020 7809 8617
Morley Fund Management 07736 883832

Notes to Editors
Morley Fund Management

  • Morley Fund Management (‘Morley’) is anindependently managed, London-based, asset management businesswith over £111 billion* under management (as at 31.03.04). Itactively manages a diverse range of asset classes and employs inthe region of 900 staff worldwide based in London, Singapore andan associate office in Boston**.
  • Morley is a wholly owned subsidiary of the Aviva Group andmanages both institutional and retail funds under the Morleybrand. It also acts as investment manager for a range of retailinvestment funds, marketed in the UK by Norwich Union, andinternational funds marketed under the Aviva Funds brand.

*Not including mortgage assets

**Morley Fund Management International Limited, an Avivacompany

Awards

  • Pensions Management Provider Awards 2003 – Best PropertyFund Manager
  • Fund Manager of the Year - Pensions Week Awards 2002
  • Specialist Manager of the Year - UK Pensions Awards 2002
  • Insurance Fund Manager of the Year (awarded to Norwich Union)- Standard and Poor’s 2002
  • Sustainable and Ethical Investment and Asset Management Award -Liveable City Awards 2002

Further information about Morley Fund Management can be found at http://www.morleyfm.com

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