AQR announces plans for five new mutual funds seeking total return

By Toni Weeks

San Diego, April 5 - AQR Funds is planning five new mutual funds, according to an N-1A filing with the Securities and Exchange Commission.

The funds are the AQR U.S. Defensive Equity Fund, the AQR International Defensive Equity Fund, the AQR Emerging Defensive Equity Fund, the AQR Risk-Balanced Commodities Strategy Fund and the AQR Risk-Balanced Commodities Strategy LV Fund. All will be offered with class N shares. The ticker symbols have not yet been released.

The funds will each seek total return consisting of capital appreciation and income.

The AQR U.S. Defensive Equity Fund will use a "defensive" strategy, defined as seeking downside protection with upside potential through active stock selection, risk management and diversification. It will invest, in normal market conditions, at least 80% of its net assets, including any borrowings for investment purposes, in equity instruments of U.S. issuers, including common stock, preferred stock, convertible securities, options, warrants, exchange-traded funds, futures, swaps and depositary receipts.

The AQR International Defensive Equity Fund will use the same defensive strategy and will invest, under normal market conditions, at least 80% of its net assets, including any borrowings for investment purposes, in equity instruments of international issuers, including common stock, preferred stock, convertibles, options, warrants, ETFs, futures, swaps and depositary receipts.

The AQR Emerging Defensive Equity Fund also uses a defensive strategy to invest, under normal market conditions, at least 80% of its net assets, including any borrowings for investment purposes, in equity instruments of emerging markets issuers, including the same types of instruments as the above two funds.

The AQR Risk-Balanced Commodities Strategy Fund will allocate assets among various commodity sectors, including agricultural, energy, livestock and precious and base metals. It may also invest in fixed-income securities and money market instruments.

The AQR Risk-Balanced Commodities Strategy LV Fund will also allocate its assets among various commodity sectors, including agricultural, energy, livestock and precious and base metals. It may also invest in fixed-income securities and money market instruments. The fund will target an annualized volatility level that is lower than that for the Risk-Balanced Commodities Strategy Fund.

Jacques A. Friedman, Lars Nielsen, Andrea Frazzini and Hoon Kim will comprise the portfolio management team for the U.S. Defensive Equity, International Defensive Equity and Emerging Defensive Equity funds.

Brian K. Hurst, Yao Hua Ooi and Ari Levine comprise the portfolio management team for the Risk-Balanced Commodities Strategy and the Risk-Balanced Commodities Strategy LV funds.

There will be no shareholder fees. Management fees and total annual fund operating expenses have not yet been determined.

Greenwich, Conn.-based AQR Capital Management, LLC will be the investment adviser to the funds.

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