Franklin Templeton Investments has launched a new multi-manager fund that will invest in a variety of credit strategies sub-advised by institutional-quality hedge fund managers.
Called Franklin K2 Long Short Credit Fund FKLSX, the fund will provide investors access to a select group of hedge fund managers in a single diversified portfolio.
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The US-registered fund will aim to offer investors attractive risk-adjusted returns, while providing a tool that may help dampen portfolio volatility, with a lower correlation to traditional long-only fixed-income strategies, the company said.
Building upon Franklin Templeton’s strategic acquisition of hedge fund solutions provider K2 Advisors in 2012, the fund will look to provide total return over a complete market cycle through a combination of current income, capital preservation and capital appreciation by investing in a broad range of credit-related investments through experienced alternative strategies managers.
K2 Advisors will continually adjust the fund’s allocations to these strategies and sub-advisors to reflect the team’s top-down market views. It will allocate to a variety of hedge fund managers selected by K2 Advisors through a proprietary due diligence process.
David Saunders has been named as the fund’s co-lead portfolio manager. In addition to Saunders, the fund’s management team includes co-lead managers Robert Christian, senior managing director and head of investment research, Jeff Schmidt, managing director of portfolio construction and Charmaine Chin, managing director at K2 Advisors.
