Credit Suisse has launched a new fund based on a combination of FX and interest rate underlyings for the Japanese institutional market, a regional first for the Swiss bank.

The Zurich-based bank launched its Advanced Strategy Fund's initial public offering on 19 April and demand has been brisk, according to head of equity derivatives structuring for Asia-Pacific, Charles Firth.

"We've seen interest during the IPO period and we're expecting the momentum will continue over the next couple of months," he told SRP. "There's a genuine demand in Japan with initial IPO figures brisk."

Credit Suisse launches an average of ten offshore structured funds per year for the Japanese institutional market, which are typically sold to the local sales force and in turn to investors.  The bank's newest offering combines FX and interest rate lines through four Credit Suisse proprietary indices in an offshore fund wrapper for qualified institutional investors.

The product also includes a risk management overlay which aims to limit the volatility of the underlying assets.

The indices employ a combination of interest rate carry, interest rate momentum, foreign exchange carry and foreign exchange tail risk hedge strategy methods.

"The underlying strategies are all weather underlyings so it has the potential to perform in down or up markets and since it's a continuous offering, it's on the shelf for investors to buy or sell as their market views change.  It will always be there for them," Firth said.

The combination of a fixed income underlying in a structured wrapper is part of the bank's new direction, emphasizing a one-bank approach with cross-divisional strategies.

"This fund is a good example of increased collaboration between our fixed income and equities teams on derivatives products. The underlying asset classes are rates and FX, but our Japanese equity derivatives sales team has taken the lead in distribution and our equity derivatives structuring team has been involved with the fund wrapper," he said.

The fund, which has a minimum investment threshold of JPY10m, had JPY 1.5bn in assets and a net asset value of JPY9,985.