OppenheimerFunds, mulling a name change to Oppenheimer Asset Management to reflect a broad mandate in investing rather than just mutual funds, is now thinking through how to package the equity tranche of collateralized debt obligations for high-net-worth investors. The planned move is a unique one-and Oppenheimer has yet to come up with a full-proof strategy to actually offer the securities-but it is in line with Oppenheimer's aggressive bid to offer a full lineup of investments for the affluent market. Oppenheimer has had success in packaging CDOs for the institutional market, raising about $1 billion last year. "We want to take a truly institutional product and redesign for the HNW investor," the official said.
Oppenheimer has not yet set a timetable for a launch, and one official said it probably won't even happen next year. A lot depends on how Oppenheimer ultimately packages the securities, said the official, who added a think tank of sorts has been formed to mull different possibilities to design the securities. Likely investors would come primarily from overseas markets, said the official. According to Financial Research Corp., Oppenheimer is well positioned to take advantage of the market for high-net-worth investors, and a strategy that is necessary in today's environment of modest growth for mutual funds. Other planned initiatives for Oppenheimer include a full-scale managed accounts effort, college savings programs, hedge funds through its Tremont Advisers acquisition and subadvisory mandates.
Although Oppenheimer has been modestly set back by the destruction of its offices at the World Trade Center-it is now located at several back-up locations throughout the New York region-the official said none of its long-term strategies is being affected by the disaster. He said the firm had been tightening its belt before Sept. 11 and now like most mutual fund complexes is trying to assess the current and possible future damage to the economy from the terrorist attacks.