Mackenzie Investments has announced the launch of the Mackenzie Private Equity Replication Fund.
Mackenzie says the mutual fund seeks to provide access to the amplified return and managed volatility characteristics of U.S. private equity buyouts. “It does this by replicating key elements of the private equity investment profile including active exposures to specific industries, leverage, and volatility management,” says Mackenzie.
The company adds that the fund invests in U.S. publicly traded companies (as opposed to private equity) that possess characteristics similar to what private equity firms select for investments, such as high quality companies with elevated profitability that trade at attractive valuations. The aim is to outperform a broad U.S. small-mid cap index, which most closely represents the focus area for private equity.
"Generally, private equity has historically exhibited less downside than traditional investments during periods of market stress and has outperformed public markets during challenging economic conditions," said Michael Schnitman, Senior Vice President and Head of Alternative Investments, Mackenzie Investments. "To date, retail investors have had limited access to private equity risk-return opportunities. We believe that through dedicated research and quantitative expertise, public markets can be leveraged to achieve similar returns and volatility levels to that of U.S. private equity in a format that offers investors daily liquidity, high transparency, and low investment minimums."
