LONDON (Citywire) - Protected Distribution Limited (PDL) has teamed up with Barclays Capital for a new water fund targeting returns of 9-11 percent per year.
The Protected Water fund is listed in the Isle of Man and launched on October 1.
The fund is an open-ended investment company with euro, dollar and sterling class shares.
The minimum investment is 10,000 pounds or the equivalent in the currency of denomination. A 2 percent performance fee is levied on top of an annual charge of 0.75 percent.
The fund is structured as 10-year investment and 100 percent capital protection is provided by Barclays Bank if held until by maturity, which is October 11, 2017.
The fund provides investors with exposure to some of the biggest water companies in the world. It will base its investment decision on an index created by Barclays Capital - the Barclays World Water Strategy - which charts the performance of some of the world’s largest water related stocks.
Barclays Capital will invest in a maximum of 40 stocks out of an investment universe of 700 companies. The fund only invests in large-cap companies in a bid to keep volatility low.
PDL, which is based in the British Virgin Islands, highlights a number of reasons as to why water is an attractive investment proposition.
It sees the growth of the world’s population over the next 20 years and the development of water resources to meet the food, fibre and energy needs of this larger population as one of the key drivers of growth.
PDL also believes new water quality standards being put in place in India and China will propel the water sector forward.
Directors of the fund include Earl Cowley, the former chief executive of Thomas Miller Investment, Alex Foley, who used to be an investment director at Singer & Friedlander, and Lee Portnoi, former chief executive of TIS and Absolute Assigned Policies (AAP).
Alistair Beattie, a business development manager at AAP who is responsible for distributing across the UK intermediary market, said: “We believe this is the first water fund available to UK retail investors.
“We believe population growth, industrialisation across the globe and a rise in privatisation in the water industry makes the water sector an exciting proposition.”
The Protected Water Fund is PDL’s second fund offering. It sits alongside the Protected Asset TEP fund.
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