Recently-launched wholesale financial education and compliance provider joint venture, Maxima, is marketing a new India fund to institutional investors in NZ.
Maxima, a JV formed by Wellington firms Dynamique and Compliance Plus earlier this year, will be local point of contact for the Mauritius-based Seven River Fund.
Launched in 2016, the approximately US40 million Seven River fund, managed by Mauritius-headquartered Lion Peak Management, invests in a concentrated portfolio of Indian shares.
Under the offer documents, wholesale NZ clients with at least $100,000 to invest will be allocated B shares in the Seven Rivers fund.
According to Guy Dobson, Maxima co-founder, Seven Rivers operates under a “hedge-like” structure with annual management fees of 2 per cent coupled with a performance fee capturing 20 per cent of outperformance above the return benchmark of 7.5 per cent.
The Seven Rivers fund, headed by portfolio manager Rohan Patki, holds a maximum of 20 stocks, targeting companies with potential to scale-up within three years, according to offer documents.
Both the Financial Markets Authority (FMA) in NZ and the UK Financial Conduct Authority “have been made aware of this product and current marketing to that specific [wholesale] client segment”, the Seven Rivers offer document says.
Dobson said the fund could appeal to investors looking for exposure to the fast-growing Indian market, which is experiencing a Chinese-style expansion of its middle-class.
“India is where China was five years ago,” he said. “Recent reforms have resulted in an improvement in rules over property, taxes and investment environment for overseas investors.”
While fund-marketing is a slight departure from Maxima’s core offering of CPD education and anti-money laundering compliance services, Dobson said the move was a “natural progression”
“Maxima will eventually cover CPD, specific expert investor funds introductions and other appropriate areas,” he said. “How we help people develop product and services feeds into our CPD.”
Dynamique teamed up this May with Compliance Plus, founded almost four years ago by former FMA AML/Countering Financing of Terrorism expert, Uddhav Kirtikar, to create Maxima.