DWS Scudder offers portable alphas access to alternative asset classes

Date: Tuesday, August 14, 2007
Author: Hedgeweek.com

DWS Scudder, the US retail division of Deutsche Asset Management, has launched the DWS Alternative Asset Allocation Plus Fund, an open-ended mutual fund that seeks capital appreciation by investing in alternative asset categories and plans to employ a portable alpha strategy. Class A, C, S and institutional shares will be offered through intermediary advisors and institutions.

The fund is structured as a fund of funds, with assets invested in a combination of underlying DWS funds, other securities and derivative instruments. It seeks to give shareholders access to alternative asset categories and strategies such as market neutral, inflation-protection, commodities, real estate and emerging markets.

'Institutions have long benefited from investing in less correlated, alternative asset classes to complement their core holdings, but accessibility to such strategies has, until now, been far more elusive for retail investors,' said Doug Beck, a managing director and head of product management at DWS Scudder.

'This fund is designed to be a simple solution that gives the average mutual fund investor access to components of what we believe are some of the best alternative ideas, through one easily accessible strategy.'

The underlying funds will include the DWS Commodity Securities Fund, DWS Disciplined Market Neutral Fund, DWS Emerging Markets Equity Fund, DWS Emerging Markets Fixed Income Fund, DWS Gold & Precious Metals Fund, DWS Inflation Protected Plus Fund and DWS Rreef Global Real Estate Securities Fund.

'From a financial advisor's standpoint, this niche product complements traditional asset allocation,' says Philipp Hensler, chairman and chief executive of DWS Scudder Distributors.

'It offers the potential for adding return and minimising risk through investing in a diversified set of asset classes that are largely uncorrelated to the core US equity and bond markets. This is a one-stop, accessible solution to diversify into alternatives, which can benefit investors during various market cycles.'

The fund will employ Deutsche Asset Management's integrated global portable alpha strategy, iGAP, when fund assets reach USD50m. This strategy aims to add uncorrelated, consistent excess return to portfolios by taking advantage of inefficiencies in country equity and bonds, yield curve and currency markets around the world using a multi-manager, multi-style approach.

The fund is quantitatively managed by Deutsche Asset Management's quantitative strategies group. Robert Wang, a managing director, is the portfolio manager of the fund, while director Inna Okounkova is co-manager. The fund's investment manager is Deutsche Investment Management Americas.

DWS Scudder is part of Deutsche Asset Management, the marketing name in the US for the asset management activities of Deutsche Bank, Deutsche Bank Trust Company Americas, Deutsche Investment Management Americas and DWS Trust Company. Deutsche Bank's asset management division had some EUR553bn in worldwide assets under management at the end of March.