Hillsdale Investment Management is launching the institutional class the Hillsdale Canadian Market Neutral Equity Fund and the Hillsdale Canadian Aggressive Hedged Equity Fund.

The funds are designed to offer protection during declining markets, low correlation to traditional asset classes; and to qualify as domestic content for Canadian registered pension plans.

After seeding of $38 million by a major Canadian institution, the funds’ initial offering will be limited to $150 million and is expected to be completed by early 2002.

The two institutional class hedge funds join Hillsdale’s “A” class funds launched in 2000 and currently available to investment advisors through the FundServ network.

The Hillsdale Canadian Market Neutral Equity Fund is an “absolute return strategy” targeting annual returns of 8% to 12% with no exposure to market direction.

The Hillsdale Canadian Aggressive Hedged Equity Fund is a “long-short equity strategy” targeting returns in excess of the TSE 300 with exposure to approximately one-half of the market’s direction.

“Both funds are designed with stringent risk budgets”, says Chris Guthrie, president of Hillsdale Investment Management Inc. They feature a full-time commitment to short selling as well as investment restrictions on the use of leverage, number of positions, size of positions and minimum market capitalization which are outlined in the offering documents.

In addition, the funds feature daily valuation performed by TD Bank, Prime Brokerage services provided by BMO Nesbitt Burns and Trusteeship by Canada Trust.

Deloitte and Touche have been appointed as auditors. Liquidity is available on 90-days notice and transparency is provided as per client requirements.

Arun Kaul, principal of Hillsdale and Pierre Raymond, associate portfolio manager, will manage both funds.