March 17, 2020 / 10:20 AM / 12 days ago

Morningstar reviews H2O Allegro fund on risk concerns

LONDON, March 17 (Reuters) - Fund rating company Morningstar said on Tuesday it had placed the H2O Allegro fund, run by Natixis affiliate H2O Asset Management, under review as recent “extreme” losses raised concern over its risk management.

The fund had posted losses of 17.9% on March 9 and 25.4% on March 12 as coronavirus fears and a sliding oil price hit markets, pushing the fund’s volatility up to 40% on an annualised basis, Morningstar said in a note.

“In the past, the fund has routinely exceeded its 7% to 12% average ex-post volatility target (referenced in the fund’s prospectus), but the extent of the recent derailment is alarming,” Morningstar said.

H2O was not immediately available to comment when contacted by Reuters. (Reporting by Simon Jessop Editing by Rachel Armstrong)

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