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Derivatives

AXA Pitches Capital-Protected Real Estate Fund

AXA Investment Managers is marketing a capital-protected closed-ended fund linked to real estate funds.

AXA Investment Managers is marketing a capital-protected closed-ended fund linked to real estate funds. Pascal Christory, head of structured derivatives at AXA in Paris, said property is a fashionable investment right now, but with capital protection it suits investors who think the market is already at very high levels.

The capital protection is generated by constant proportion portfolio and Banque AIG will provide a guarantee and gap-risk protection on the fund. The fund is a five-year structure, which works by moving assets between investment in zero-coupon bonds and leveraged investment in the real estate funds to guarantee growth and the return of capital by the end of the product's term. The leverage factor will be a maximum of 4.5%, but Christory said this will change with the volatility of the underlying. The fund, named Garantiss'Immo, closes Aug. 16 to new investment.

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