KIS Real Return, protecting capital

30 October 2014

True to its original spirit of innovation and the relentless search for opportunities in the overall market context, this November 4th, Kairos will launch KIS Real Return, “a product aimed at achieving positive real returns and therefore protecting the purchasing power of capital from rises in interest rates and inflation.” This is how Fabio Bariletti, the Kairos Group’s General Manager, explains the new product, and goes on to describe the management guidelines that the Fund’s managers Rocco Bove and Vittorio Fontanesi will follow over the next few months.

“This product is the result of our realization that, given the high bond exposure that characterizes Italy, we needed to create another alternative for our clients within the bond world.  It is a strategic approach that focuses on boosting the efficiency of an average portfolio dominated by interest rate risk at a time when rates are zero.” Bariletti echoes Rocco Bove as he clarifies, “KIS Real Return will be a variable allocation multi-asset fund that stands on three main legs: first, its core holding will consist of bonds indexed to inflation and floating interest rates with a mandate to use all types of hedging instruments. Next, its investment strategy will include an equity-related portion with a focus on names and sectors that tend to remunerate inflation. Third, the Fund will also invest in commodities and real estate, leveraging the expertise of the Kairos funds of funds team in the selection of top players.”

With expected returns of 4% to 6% and an approach based on reducing portfolio volatility, KIS Real Return will expand the range of Kairos SICAVs. Why schedule the launch for November 4th? “November 4th marks exactly three years from the launch of another Kairos smash hit, KIS Bond Plus: it is, in a way, the passing of the baton from one cycle to another,” notes Bove. However, the cycles have not yet reached their end but fit one on the other, and when they meet, the Kairos Group intends to be ready.