Bestinvest says
Standard Life have been running the Global Absolute Return Strategies (GARS) mandate for institutional clients since 2006. Essentially it is a cost efficient multi-strategy hedge fund seeking to deliver positive returns over the medium term at relatively low levels of volatility. The mandate is well diversified with no single strategy dominating the portfolio.
The investment team develop a number of investment ideas based on a 3-5 year view and then invest in these ideas using strategies that employ both traditional asset classes, such as equities and bonds, as well as more sophisticated, derivatives-based instruments. Because of this multi-year view, the managers do not look to exploit short-term arbitrage, instead focussing on fundamental opportunities. Typically the fund will have between 20 and 40 such strategies employed at any one time and can take both market directional views, i.e. specific markets will rise or fall, or use a relative value approach, i.e. one specific instrument will do better than another regardless of the overall market direction . More advanced strategies include bond duration, credit spreads, inflation and volatility trades. The managers have the flexibility to invest anywhere in the world and risk is tightly controlled with a particular focus on the Value At Risk (VAR) measure and volatility targets.