Loomis Sayles Powers a Diverse Absolute Return Fund
Reported by Neil Anderson, Managing Editor
Loomis Sayles just launched a new absolute return fund with a twist. On Thursday the Natixis shop released the Loomis Sayles Multi-Asset Real Return Fund [see filing], "designed to counter a variety of potential global inflationary environments, such as classic inflation, debtflation, stagflation or deflation."
The fund boasts three co-PMs: Kevin Kearns, fixed income PM and senior derivatives strategist; David Rolley, global fixed income PM, global investment strategist and chief of the yield curve sector team; and Laura Sarlo, fixed income PM and senior sovereign analyst. The fund has three share classes: class A, which come with a maximum load of 450 basis points and total annual operating expenses of 140 bps (after waivers, etc.); class C, for a max of 100 bps in deferred load and 215 bps in annual expenses; and Y shares for 115 bps in annual expenses.
Natixis handles administration and distribution for the new fund. State Street serves as the custodian, Boston Financial handles transfer agency, Pricewaterhouse Coopers is the fund's accounting firm and Ropes & Gray provides legal counsel.
Company Press Release
BOSTON--Loomis, Sayles & Company announced today that it has launched the Loomis Sayles Multi-Asset Real Return Fund (MARYX), a mutual fund featuring multi-asset class diversification designed to counter a variety of potential global inflationary environments, such as classic inflation, debtflation, stagflation or deflation. The Fund was developed for investors looking for solutions beyond single asset class strategies, like TIPS, that may be limited in their ability to combat all forms of inflation. The Fund will be co-managed by Kevin Kearns, fixed income portfolio manager and senior derivatives strategist; David Rolley, global fixed income portfolio manager, global investment strategist and head of the yield curve sector team; and Laura Sarlo, fixed income portfolio manager and senior sovereign analyst.
The flexible and tactical nature of this strategy is aimed at preserving and growing the purchasing power of investor portfolios under a variety of economic conditions, while also seeking to limit volatility. The Fund may be well suited for investors concerned with building long-term purchasing power as well as those uneasy about the overall diversification level of their investment portfolios.
Using a flexible mandate that allows tactical investments in a wide range of asset classes and security types, the Fund's performance goal is to beat the US consumer price index (CPI) over a full market cycle. In an effort to meet this goal, the investment team leverages Loomis Saylesí deep fundamental fixed income and equity research capabilities, macroeconomic resources, and quantitative analysis and risk management capabilities. Using this combination of top-down macroeconomic analysis and fundamental research, the portfolio management team seeks to identify the nature of global inflationary or deflationary trends and then applies sector and security specific allocations in an effort to optimize the Fund's risk/reward potential. Based on the team's inflation thesis, the Fund may invest in a broad range of securities globally including fixed income instruments (TIPS, government, sovereign, and corporate), equities, ETFs, REITs and commodity instruments. Investment decisions can be implemented in a flexible manner, including through the use of derivatives and long/short strategies.
The Fund seeks to realize its performance objectives while also minimizing volatility and uses an investment process that incorporates a disciplined risk management approach to address all the asset classes within the portfolio.
"Many investors, particularly those with fixed incomes or defined retirement portfolios, are concerned with preserving the purchasing power of their assets. Doing so under a variety of potential future economic scenarios can be challenging, particularly as inflation may not be readily apparent in CPI figures. We believe that this demands deep macroeconomic perspectives and the flexibility and capability to apply this analysis across a wide range of markets, asset classes and security types. Limiting one's investment approach can be problematic given considerable future economic uncertainty and likely volatility," said Jae Park, Loomis Sayles' chief investment officer Ė fixed income.
"We believe that unlike a single asset class strategy, like TIPS, the adaptable nature of this strategy not only has the power to capitalize on inflationary trends in their multiple forms but also complements other equity and fixed income investments one may hold in a portfolio. The strategy has the potential to generate attractive real returns while also offering overall portfolio diversification benefits," added Kevin Kearns, co-portfolio manager.
About Loomis Sayles
Since 1926, Loomis, Sayles & Company, L.P. has served the investment needs of institutional and mutual fund clients. As performance-driven investors seeking exceptional opportunities, Loomis Sayles employs actively managed disciplines that combine fundamental research, systematic risk assessment and experienced portfolio management. This rich tradition has earned Loomis Sayles the trust and respect of clients worldwide, for whom it manages more than $141 billion in equity and fixed income assets as of June 30, 2010.
Derivatives, primarily futures and forward contracts, generally have implied leverage (a small amount of money to make an investment of greater value). Because of this, the fundís extensive use of derivatives may magnify any gains or losses on those investments, as well as risk to the fund. Over the Counter (OTC) derivative contracts involve counterparty risk, or the risk of default to a derivative contract, and liquidity risk; market volatility may prevent the fund from closing out contracts at the desired time and price.
Before investing, consider the fundís investment objectives, risks, charges, and expenses. Please visit loomissayles.com or call 800-225-5478 for a prospectus or a summary prospectus containing this and other information. Read it carefully.
Natixis Distributors, L.P. (fund distributor) and Loomis, Sayles & Company are affiliated. Natixis Distributors, L.P. 399 Boylston St. Boston, MA 02116