Global investment specialists Dalton Strategic Partnership has revealed details of the upcoming launch of the MST European Fund.

The fund, which will be a sub-fund of the Luxembourg SICAV Melchior Selected Trust, will aim to deliver positive absolute returns, uncorrelated to equity or bond markets.

Managed by Leonard Charlton, a former Goldman Sachs trader, the MST European Fund will follow the same investment approach as his current hedge fund, the Melchior European Fund. Launched in October 2006, that fund achieved a positive return of +8.01 per cent in 2007, +6.26 per cent in 2008 and +4.29 per cent in 2009.

The MST European Fund marks the first time the long/short investment capabilities of Leonard Charlton will be available to investors in a regulated product.

The new Fund will use the full UCITS III powers including leverage and derivatives to replicate the strategy employed by the Melchior European Fund. It combines a fundamental approach to selecting long and short positions, with an active trading overlay.

The Fund will comprise 30-60 positions, normally in individual European stocks and will typically operate within a net exposure range of +/- 20 per cent. Gross exposure will normally be between 80 per cent – 150 per cent.

Charlton, said, ‘I am excited to be launching this new UCITS III fund. DSP has proven experience of marketing and managing UCITS funds and I believe that the MST European Fund will be a welcome addition to the existing range of long-only funds offered within the Melchior Selected Trust.

‘2010 will see a more choppy and challenging market environment which will be well-suited to my flexible style of investing. My approach is ideal for investors who seek positive returns with a low level of volatility.’

The fund has a minimum investment of US$10,000 and an annual management fee of 2 per cent.