Case Study – Janus Henderson Global Multi Strategy Fund
Janus Henderson Investors has recently made available its Global Multi Strategy Fund on the Australian Securities Exchange’s mFund. Matt Gaden, head of Australia at Janus Henderson Investors, explained why they decided to launch this multi-asset global portfolio now and how it can help investors looking for alternative investment solutions.
What goes into launching a new product?
Fundamentally, the four key questions Janus Henderson seeks to solve with any new product are:
- What is it that investors are seeking?
- Do we have a compelling and differentiated investment solution to solve that need?
- Would investors consider Janus Henderson for that solution?
- What would it need to look like as a finished product (including features, structuring, pricing and so on)?
In launching the Janus Henderson Global Multi-Strategy Fund, we had confidence we had ticked those boxes, having validated our thinking thorough research and market testing. And, as anyone will tell you, that’s critical in truly understanding what investors are seeking from their investment managers today. With appropriate governance structures put in place, the project then rolled very quickly into implementation – which in our case involves a whole of business approach. So we involve people from operations, compliance, our investment teams, product, marketing, distribution, legal and many others to work hand in hand with our external service providers, to build a compliant vehicle to bring our investment capability to market.
Why did you decide to launch on mFund now?
We currently have a number of solutions suitable for retail investors now available on the mFund platform. Having recently launched the Janus Henderson Global Multi-Strategy Fund as an Australian managed investment scheme, and having seen strong early demand for the fund, it simply made sense for us to make it as easily accessible to investors – and in the format they prefer. So an mFund offering gives investors the flexibility to invest in the strategy the way that best suits them; irrespective of whether that’s through the more ‘traditional’ managed fund where an investor is able to apply directly to us via an application form, or now via the ASX portal on the mFund platform.
How did you research market opportunities?
Australian investors haven’t always had alternative investment solutions that really meet their needs. We knew from experience that our multi strategy investment capability, with its 10 plus year history and successful track record, was very well regarded globally and compared pretty favorably to other alternative solutions available in the Australian market. Even still, we undertook an extensive consultation process with researchers, consultants, some of our existing clients as well as potential prospects to ensure we really understood what they were looking for from a multi strategy investment solution. We also took time to analyse global databases and ensure we really deeply understood the competitive landscape; their products, strengths and weaknesses, and particularly in relation to portfolio composition, performance, product costs and fees, volatility and risk.
What challenges did you face and how were they overcome?
New product launches always have a number of complexities to them; new product launches during COVID-lockdown possibly even more so! Structuring was probably the thing we spent the most time to ensure we got it right when launching the Global Multi-Strategy Fund. Our multi strategy investment capability has been running successfully for a decade and offered to investors via a Cayman structure, which has an incredibly strong track record and been recognised globally with a number of awards, but that vehicle only offered monthly dealing and monthly pricing.
So our challenge was to structure it in a way that allowed daily dealing and gave investors the transparency of daily pricing, but in a way that didn’t add unnecessary cost, administrative complexity or add delays to the timeline. So that’s probably where we benefited from being such a large global manager, as our collaborative approach in working with colleagues from right across Australia, the US and the UK, allowed us to create a UCITS, an Australian Unit Trust and ultimately an mFund, to ensure we could tailor our offer to what Australian investors were seeking.
How did you decide on service providers?
Where we can, we look to work with service providers who are already trusted partners of Janus Henderson. Today, BNP supports us across our Australian fund range, on both an admin and custody services basis, so the decision to have them work with us bringing the Global Multi-Strategy Fund to market for the Australian unit trust, as well as the underlying UCITS vehicle, was in line with our existing service model both here and in the UK.
Can you explain the fee structure?
We wanted to ensure our offer was competitively priced for investors and that there was true alignment between investor outcomes, returns and fees. So the fee structure for the fund is made up of 3 components: a management fee, the indirect costs and a performance fee. The management fee component is 0.90 per cent per annum of the assets of the fund, and this is calculated and accrued daily in the asset value of the fund. The indirect costs component is estimated as 0.17 per cent per annum of the asset value of the fund. These costs are deducted from the assets of the fund as and when they are incurred and reflected in the asset value of the fund rather then charged separately to unitholders. The performance fee component is calculated as 20 per cent of the funds daily outperformance of the current day net asset value (NAV) relative to the prior days NAV above the Bloomberg AusBond Bank Bill Index (after management fees) and subject to a high watermark.
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