Euro Pacific Asset Management, LLC, a Newport Beach, California-based asset manager affiliated with Peter Schiff’s brokerage firm, Euro Pacific Capital, has launched the EuroPac Hard Asset Fund. The fund, which will trade under the symbol EPHAX, is the fifth fund offered by Euro Pacific Asset Management. Other funds focus on such sectors as foreign bonds (EPIBX), small cap Asian equities (EPASX), international value stocks (EPIVX), and Chinese equities (EPHCX).
The new mutual fund attempts to provide capital appreciation and hedge against inflation over a long-term investment horizon by selectively investing in hard asset securities as well as those currencies that the team believes have the greatest potential for appreciation against the US Dollar. As a secondary objective, the Fund seeks income from dividends and interest.
The Fund is managed by Peter Schiff (pictured), investment committee chairperson, and Jim Nelson, CFA, portfolio manager, the same team that overseas two of Euro Pacific Asset Management’s other fund offerings, the EuroPac International Value Fund (EPIVX) and EuroPac International Bond Fund (EPIBX). The strategy is geared for US-based investors who are concerned about the rising tide of global inflation and the long term uncertainty of the US dollar. To hedge against these forces, the Fund will seek to invest in a basket hard asset commodities, such as gold and silver, non-dollar equities in the commodity sector, and foreign currencies.
“The last few years have seen an unprecedented pace of monetary expansion from the United States and other countries looking to keep pace in a game of competitive currency debasement,” says Peter Schiff. “As a result, it is inevitable that some investors seek to stock up on tangible assets that tend to hold value in periods of high inflation.”
The EuroPac Hard Asset Fund uses a top-down approach to deploy funds to those asset classes that the managers believe have the best potential to hedge against inflation and the likelihood for appreciation in a declining dollar environment. Asset classes include gold and silver, precious metal mining companies, and companies involved in energy, agriculture and the production of industrial metals. The fund may also hold cash denominated in foreign currencies.
“A casual observer may assume that our new Fund will behave like a precious metal fund, which many investors already seek for inflation protection,” says Jim Nelson. “But we have designed it with many characteristics that may distinguish its performance from that category of funds. In particular, the Fund’s asset allocation will seek to maximise the portfolio’s correlation and sensitivity to the inflation rate, while also maximising risk-adjusted return and generating as little volatility as possible.”
