Mellon Global Investments has joined a long list of funds managers tapping into institutional demand for long/short equities funds.
The firm has launched the Mellon Australian Equity Long/Short Trust, which is aimed at Australia's institutional market.
It has been seeded by Australian Wealth Management's asset management arm, United Funds Management.
The fund is sub-advised by Mellon Capital Management in San Francisco and will invest in large and mid cap stocks.
It will use quantitative process and aims to exploit mis-priced stocks, while minimising exposure to systematic risks.
It will target a tracking error of 5 per cent.
Mellon joins a long line of managers that have established long/short equities funds in response to insatiable demand from investors
In March Industry fund HESTA announced it had allocated 10 per cent of its total international equities strategic asset allocation to long/short managers.
The health and community services industry fund said it had appointed three global long/short managers with a total allocation of just under $300 million.
The managers are all United States-based and comprise Acadian Asset Management, Axa Rosenberg and AQR Capital Management.
Mellon Capital has over $223.3 billion in assets under management.
