UK-based fund group Global Asset Management (GAM) has launched a 13-class umbrella exempt fund for UK pension funds, charities and institutional investors. This will be a precursor for funds aimed at continental European institutions in a few months' time. We have seen an explosion in the numbers of European institutions investing in our funds in 1997," says David Duncan, director of GAM's institutional division. He attributes this to a dramatic change in continental attitudes to equity investing last year, when for the first time in-stitutions from seven different countries invested $120m in its funds.

He expects the new umbrella fund to be launched mid-year in Dublin where it will have a stock exchange listing.

With the new GAM Exempt Trust fund, the group hopes to capitalise on the trend to specialist managers in the UK. Duncan says: "We are seeing ourselves increasingly pulled into beauty parades, because of our out-performance in 1997, which was contrary to the rest of the industry."

Each of the fund classes of the new unauthorised unit trust has a separate geographic focus and will be managed by specialist managers for each class. All managers are from the GAM stable except for the multi-manager emerging market class, which can use up to 25 external managers.

"Each fund will be run as indentically as possible to funds that already exist," he says. "We do not allow short selling in the exempt trust, whereas some of our other funds are allowed that."

With a minimum contribution of £1m, the fund will be aimed particularly at pension funds and charities in the £100m to £1bn bracket. For funds with assets below this, the UK managed composite, with a CAPS median benchmark, could be attractive, says Duncan.

The annual management fee is 1% pa for all funds and there are no front end or exit charges.

"We would like to have £100m under management in the new fund in a year's time," says Duncan. "I suspect the vagaries of the market will determine which funds will be used, but we expect Europe and the Pacific classes to do well."

For GAM, which runs up to 60 different funds for institutions worldwide, this is the first real drive at the UK, where it has had just one exempt fund so far. North America accounts for two thirds of the $2bn the group has under management for institutions worldwide. Altogether GAM manages assets $11.5bn."