GAM, the fund management arm of Swiss banking group Julius Baer, has launched GAM Trading II – GBP 1.25XL to give investors leveraged exposure to its GAM Trading II fund, an offshore fund of hedge funds.

According to the firm, GAM Trading II has very low correlation to traditional asset classes and has consistently delivered positive returns in all market conditions since its inception in 1997. In 2008 - which is noted as hedge funds’ worst performing year on record - the fund generated over 8.6 per cent, GAM said.

“GAM Trading II – GBP 1.25XL is designed for investors that have a strong positive view of GAM Trading II and want to enhance their exposure for the same amount of capital. The class will seek to apply for UK distributor status in the UK, making it particularly appealing to UK investors,” said Martin Harrison, GAM’s head of mutual funds in the UK.

Media reports last week focused on Julius Baer’s planned split of its private banking and asset management arms. Investors convene on 30 June to vote on the split, which will see shareholders receive one share in the new GAM asset management entity for every share owned, and who will also have one share in the private banking unit.

The Swiss bank has said its private-banking arm, the larger of the two and expected to remain in Switzerland's blue-chip index, will apply "broadly the same dividend and capital management policy" as the existing Julius Baer, which is comfortably positioned for capital and has paid out dividends in recent years.