Fund manager offers capital guarantee

The director of fund manager Liontamer says a new "money back" fund it is launching is a signal that investment markets are becoming less volatile.

Liontamer, which specialises in "capital protected" funds, says its Global Series 7 fund will offer full exposure to the upside of global share markets and full capital protection if the market falls.

Liontamer investment director Janine Starks says it has been at least a year since her company was able to offer 100 per cent guarantees on capital because market volatility made full protection too expensive.

"It's a real indication of market conditions improving and we're really trying to send this message out to investors."

Full exposure meant that "for every 10 per cent the sharemarket goes up, you get a 10 per cent return. It exactly mirrors it."

If the market went down, investors would at least get their initial investment back.

Investors who wanted more risk could waive their protection and get 145 per cent of any upward market swing. If the market fell by 30 per cent, they would get 70c in the dollar.

The fund, which closes on May 21, is based on a basket of global share indices, with about half weighted towards US equities.

Liontamer says the full capital protection extends to those who stayed with the 6-year fund until maturity but those who want to withdraw earlier can do so on a monthly basis with an early exit fee.

Liontamer has $250 million funds under management.

- © Fairfax NZ News