On the heels of the success of its
Endeavor growth fund, Invesco is developing a global version of the fast-trading fund for stock-picker Tim Miller.
According to papers filed with the
Securities and Exchange Commission
Invesco Global Endeavor
will be similar to its domestic predecessor. The fund will take an all-cap approach, focusing on the fastest-growing companies in the fastest-growing industries around the world. The fund can invest all its assets overseas and generally will hold stocks from at least five countries, including the U.S.
Miller, who'll lead the new fund's team, has run the domestic Endeavor fund since its 1998 inception with solid results. The fund spreads its assets among companies of various sizes, but
classifies it as a large-cap growth fund. Over the past 12 months it's up 57.4% and up 8.8% since Jan. 1. Both returns beat the S&P 500 and more than 70% of the fund's peers, according to Morningstar.
A couple of caveats are probably in order, though. Those returns are the result of some big bets -- more than 60% of the fund was in tech stocks at the end of June -- which could bring some serious volatility. The new fund also might have a turnover rate north of 200%, which could lead to significant capital-gains distributions down the road.
The fund's filing doesn't include details on its fees and expenses.
New Fund to Play Merger Game
A new merger-arbitrage fund is being developed that could look and perform like the
Merger Fund, one of the most unusual funds out there.
Fledgling New York money manager
Water Island Capital
on Friday filed preliminary paperwork for the new
Fund with regulators. On paper, its strategy resembles that of the Merger Fund, which -- surprise, surprise -- primarily invests in companies that have announced plans to merge.
Here's how it works: When a merger is announced, the stock of the target company typically rises, while the acquiring company's stock often falls. Consequently, the fund will often buy the stock of the target company and short the acquirer's stock. Short-selling is essentially a way to profit from a falling stock by selling borrowed shares, hoping to return them for a lower price later on.
Over the past few years the Merger Fund, now closed to new investors, has been lauded as one of the best ways to earn solid returns while protecting against broad market selloffs through its short positions. The fund targets 10% to 15% annual returns and in the past five years co-Managers Fred Green and Bonnie Smith, who've held the reins since the fund's 1989 inception, have managed a 12.5% annualized return with only one down quarter, according to
Of course, executing this strategy can be difficult. If the fund, which aims for a fall launch, invests in a deal that falls through, investors could take a beating.
John S. Orrico, a former hedge-fund manger, will be at the helm of the new fund, according to the filing. He doesn't appear to have experience running a retail mutual fund, but he did run private accounts in a merger/arbitrage strategy from 1994 to 1998. Last year he ran private hedge accounts for
Lindemann Capital Partners
The Arbitrage Fund won't carry a load or sales charge, but it does levy an annual 0.25%
12b-1, or marketing, fee. Annual expenses are expected to be 1.95%. Both the average U.S. stock fund and Merger have a 1.38% expense ratio, according to Morningstar.