Saying the markets have overreacted to worries about inflation, Majorica Asset Management is launching two new pooled funds – Majorica Bond Fund and Majorica Short Term Income Fund.

Majorica said the new funds will be managed by a team headed by Robert Marcus, former chief of the fixed-income portfolio management team of Altamira Investment Services Inc., along with Edward Jong, former vice-president, fixed income of Altamira, with responsibility for short-term fixed-income mandates. Majorica was founded last year by Robert Marcus and other former colleagues from Altamira.

Marcus said he believes now is an appropriate time to invest in bond funds although interest rates are forecast to rise. “Transparent monetary policy by central banks has already caused 10-year yields to move significantly higher, prior to any change in the administered rates,” he said in a release.

“Market sentiment has swung from a deflationary environment to an inflationary one. The truth lies somewhere in between. The markets overreaction to inflationary concerns has created significant opportunities.”

Marcus said “the Fed will do what it takes to preserve price stability, which ultimately bodes well for the bond market. In addition, the allure of fixed income funds is accentuated by recurring geopolitical concerns which will undoubtedly intensify. This will naturally keep investors interested in the certainty of high quality fixed income securities.”

The Majorica pooled funds are distributed by offering memorandum and are available through selected dealers and financial planners or directly from Majorica and its affiliates. The funds’ competitive management fees are tax-deductible, providing an additional benefit to investors.

The funds are designed to meet the expectations of high net worth investors for predictable income, liquidity, capital preservation and a hedge against portfolio volatility. Value is added through active duration, yield curve and credit management. The funds are being sold in Ontario and other permitted provinces pursuant to the private placement rules.