(March 4, 2010) – Hermes Fund Managers Ltd. is seeking institutional investors for its three commodities funds as part of its strategy to raise assets.
The Hermes Commodities Alpha, Index and Index Plus funds, which have generated returns above their benchmarks from inception, manage approximately $1.5 billion, mostly for the BT Pension Scheme, Bloomberg reported.
“Adding commodity exposure to a pension scheme’s strategic asset allocation can provide significant diversification benefits through low correlation with other asset classes,” said Colin O’Shea, head of Hermes Commodities, in a news release. “Overall pension scheme risk can be lowered by adding commodities without a reduction in return expectations,” adding that commodities would help hedge against rising inflation and risk.
Hermes Commodities, led by Colin O’Shea, Jason Lejonvarn and David Hemming, is one of the largest fund long-only commodities managers, according to a news release. The team expects their first external investments in late March.
O’Shea continued, “We bring a successful, four year track record to market combined with the experience of a large European pension scheme and its strong governance culture: A compelling solution for pension schemes and their trustees.”
London-based Hermes invests assets on behalf of about 180 clients and has more than $37 billion under management, as of December 31. Hermes is wholly owned by the BT Pension scheme, the UK’s largest funded pension scheme.
To contact the <em>aiCIO</em> editor of this story: Paula Vasan at <a href='mailto:pvasan@assetinternational.com'>pvasan@assetinternational.com</a>; 646-308-2742