IA Clarington introduces liquid alt and international equity funds

Toronto-based IA Clarington Investments Inc. is launching two new funds: a liquid alternatives fund and an international equity fund.

Eric Frape, IA Clarington’s senior vice-president of product and investments, said in a statement Friday that regulatory changes provide retail mutual funds with more latitude to use short selling, leverage and other alternative strategies.

The IA Clarington U.S. Equity Opportunities Fund, a liquid alternative solution, features a long/short approach to equity investing that offers Canadians “a new way of generating enhanced return potential from the U.S. equity market,” he said.

The fund is sub-advised by MacKay Shields LLC, an affiliate of New York Life Investment Management Holdings LLC, and modelled after one of its U.S.-based strategies, a release from the firm said.

The fund uses a 130/30 approach to long/short investing. The long-only sleeve aims for market-like returns and some alpha, whereas the long/short, market-neutral sleeve aims for pure alpha generation (typically 30% long/30% short), the firm said.

The second fund, IA Clarington International Equity Fund, is a low-cost, active core solution managed by Industrial Alliance Investment Management Inc. (iAIM).

The fund invests in industry-leading companies outside of Canada and the U.S. and uses a growth at a reasonable price (GARP) investment style, IA Clarington said.

“We believe that an active approach is critical to successful investing, particularly when investing abroad,” said Sevgi Ipek, head of international investments, iAIM, in a statement. “Our research-intensive approach aims to identify high-quality companies with excellent prospects for long-term growth.”

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