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German fund manager sets €1m charity active-passive duel

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German fund manager sets €1m charity active-passive duel

German fund of funds manager Eckhard Sauren has challenged any passive fund manager to beat his performance over the next decade with a €1 million (£900 million) charitable donation at stake.

Sauren has already spoken to members of the passive community about finding a suitable opponent for his strategy. There have been no takers as yet.

He pointed to his Sauren Global Growth fund, which he said has an annual performance of 2% after fees and it has also defended in down markets.

Sauren, one of Germany's most recognised investors, founded his Cologne-based eponymous investment firm in 1991. He is famous for being one of Germany's first fund of funds managers, with his flagship Sauren Global Defensive fund controlling some €1 billion in assets under management.

Sauren said his ideal competitor would be comparable to a balanced fund, which would have equal weighting to global and European equities, German bonds and corporate credit.

The winner would be the strategy with the highest return after fees over a 10-year timeframe. The losing party would then donate €1 million to a charity of the victor’s choosing.

Backing winners

This is not the first high profile fund manager-related wager in recent memory. Multi-manager Lee Freeman-Shor issued an open challenge to chief investment officers saying he could teach a child to outperform a professional investor with one year’s coaching. No CIO responded to the challenge.

Are you a passive manager keen to take up the challenge? Contact Citywire Selector and we can put you in touch with Sauren.

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