15/12/2009 Author: Elana Margulies

Valu-Trac announces new Morningstar joint venture

Valu-Trac Investment Management, a Scottish-based $600m investment manager, has formed a joint venture with Morningstar to launch a commodities fund, HFMWeek has learned.

The offering, called the Valu-Trac Morningstar Commodity Fund, will be a combination of the Valu-Trac Commodity Fund and the Morningstar Long/Short Commodity Index.

Robert Power, appointed representative, said Valu-Trac formed the venture to tap into the success of both products, which combined have had no down years, and to associate with a strong company like Morningstar.

“Merging the seven-year trailing track records of the Valu-Trac Commodity Fund and the Morningstar Long/Short Commodity Index creates a commodity fund that has a hypothetical record with no down years since October 2002,” he said. “Our clients have expressed interest in a stand-alone fund. We believe that the strong brand and high quality of the Morningstar name is something we are proud to be associated with.”

The new fund will take its lead from central bank behaviour and its effect on global monetary reserves and the subsequent impact on commodity prices.

Valu-Trac will manage the portfolio and be responsible for the majority of the marketing. Peter Hart, who has been a portfolio manager of Valu-Trac Strategic, the firm’s hedge fund unit, will be in charge of the new fund.
The fund has a $500m capacity. Its fees are 1/20 and its investment minimum is $1m. There is no lockup and Newedge is the prime broker.