Germans Flock To Superstar Klaus

27 Feb 2018 | 10.19 am

Germans Flock To Superstar Klaus

Concept K fund marketed by Friends First

27 Feb 2018 | 10.19 am

Not many investment funds are named after their manager, but that’s the case with Concept K, a goliath German fund that’s made available in Ireland by Friends First.

The ‘K’ in Concept K is Klaus Kaldemorgen (pictured), a fund manager who has been working at Deustche Asset Management for over 30 years. His team has an average tenure at Deutsche of 15 years and has access to 500 investment and research professionals across the Deutsche group. Those credentials have certainly struck a chord in Deutschland, as the Deutsche Concept Kaldemorgen fund size is now up to an incredible €7.5 billion.

Concept K is a multi-asset fund that aims to produce long term growth but with less of the volatility that comes with stock market investing. The fund primarily invests in company shares, government and corporate bonds, cash, gold and currencies. Kaldemorgen is also an active user of derivatives to implement investment ideas.

According to Friends First, one of the ideas underpinning Concept K is to ride the markets upside with a view to limiting sudden downsides, such as occurred recently. A stated objective is that the fund does not lose any more than 10% of its value in any calendar year, though this is not guaranteed.

Kaldemorgen’s current view is that equity markets in the US and China have decoupled from the yield development of 10-year US treasuries, which increases the potential for a setback in these markets. “The fund is primarily focusing on European stocks now,” he says. “These might be less impacted by higher interest rates in the US, as the ECB will hardly change its monetary policy before the end of the year. Dividend yield in the European equity markets should serve as a cushion and prevent a too extensive decline.”

Like most funds, Concept K has started the year poorly, down 1.9% year to date as of Feb. 22. The annualised return since launch in May 2016 is 4.2%. The AMC is 1.0% of fund assets plus a performance fee of 15% of growth above a specified target.

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