Finance professor Andrew W. Lo, who pioneered work on hedge fund beta replication strategies, has opened two funds through his money management firm, AlphaSimplex Group, and its parent, Natixis Global Associates.
The ASG Global Alternatives Fund is available to U.S. investors, and the ASG LASER Fund is offered through Natixis International Funds I, a Luxembourg-domiciled UCITS.
Mr. Lo, chairman and chief scientific officer of AlphaSimplex, developed the top-down hedge fund replication strategy that uses futures, forward contracts and other financial instruments to mimic the beta of a large number of individual hedge fund managers. The strategy provides long and short exposures to global equity, interest rate, currency and commodity markets.
“Beta replication funds seek to offer the diversification benefits of hedge funds — access to a broader set of asset classes and low correlation to traditional asset classes — while avoiding some of the downsides of hedge funds such as illiquidity, limited capacity and high fees,” said Mr. Lo in a news release.
Mr. Lo also is the Harris & Harris Group Professor at the Sloan School of Management at the Massachusetts Institute of Technology and director of the MIT Laboratory of Financial Engineering.
