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How Absolute Return Funds play a part in your portfolio
All fund managers try to achieve
best performance they can. Their entire reason for being is to maximize your return on investment. An Absolute Return Fund uses various investment instruments to derive
best consistent performance to you. Benefits of investing in an Absolute Return Fund are:
Returns in rising and falling markets
Absolute Return Funds main advantage over regular stocks is that they aim to give you return in both rising and falling markets. One of
keys to successful wealth accumulation is to continually move forward. Absolute Return Funds ignore bearish and bullish trends to be consistent performers in your portfolio.
Diversification in non-traditional investment instruments
Diversification in your investment portfolio is a key to success. Your portfolio should already contain shares, bonds, property, cash, fixed interest investments. Absolute Return Funds offer another weapon in your wealth accumulation armoury. You are able to diversify your portfolio further which gives you more security and, over time, a better return on investment.
Liquidity
Units in Absolute Return Funds are often available directly from
fund manager but are easily found, and traded, on
stock exchange. This makes your investment highly liquid. You have
ability to increase, or decrease your stake, in a particular fund at
click of a button.
Returns from both income and capital
Absolute Return Funds can give you both returns in both income and capital. This spread will assist your tax position as you are not overly exposed to any one kind of return.
Risk Management
Absolute Return Funds are actively managed. The managers also tend to have large amounts of their own personal wealth invested to reassure
investors that
managers are always trying to maximize their return on investment.

Written & published by Murray Priestley, Managing Partner of Portofino Asset Management, private investment managers and publishers of the Portofino Report. www.portofinoasset.com