GUERNSEY, Channel Islands (HedgeWorld.com)–HSBC Global Absolute Ltd., a closed-end fund of funds listed on the London Stock Exchange, announced the introduction of currency hedging for its sterling-denominated shares.
HGAL launched in November 2001, with the objective of achieving equity-like returns with lower levels of volatility. At launch, its investment advisers at HSBC Republic Investments Ltd., London, decided not to include currency hedging.
Subsequent weakening of the U.S. dollar against the pound has adversely affected the underlying holdings. From launch until October 2004, the net asset value per share rose 13.8% in U.S. dollar terms but fell 12.8% in sterling value.
Accordingly, at an extraordinary general meeting, Nov. 28, shareholders approved a plan to reclassify the shares in HGAL as U.S. dollar shares and sterling hedged shares.