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According to BlackRock, Skandia added Absolute Alpha to its platform in response to demand from advisers seeking to offer clients funds with consistent returns and low volatility.

The UK Absolute Alpha fund, managed by Mark Lyttleton and Nick Osborne, has returned 22.32 per cent since launch compared to 8.90 per cent on the FTSE All-Share.

In the year to date it returned 4.86 per cent compared to -4.22 per cent for the FTSE All Share over the same period.

The fund aims to deliver positive returns in all market conditions by using four investment strategies: traditional long investing; synthetic short investing; pair trades and the ability to move up to 100 per cent of the portfolio into cash if the market environment dictates.

Alex Hoctor-Duncan, head of UK retail at BlackRock, commented: "Mark Lyttleton and Nick Osborne have demonstrated in recent months they can make money for investors even when markets are falling.

"BlackRock’s UK Absolute Alpha is a suitable core holding for anyone’s portfolio, particularly in today’s volatile environment."

Graham Bentley, head of investment marketing at Skandia, added: "We have seen increasing demand for absolute return funds, in particular those that use the wider investment opportunities available to managers."

Recently Skandia International, the offshore division of the business, has added seven Skandia Global Funds (SGF) products to its Royal Skandia and Skandia Ireland fund ranges. (See story here.)