Investments in fund units are associated with risk. Past performance is no guarantee for future returns. The money invested in a fund can increase and decrease in value and it is not certain that you will get back the full amount invested. No consideration is given to inflation.
The objective of Catella Hedgefond is to achieve stable returns at low risk, regardless of market conditions.
The fund invests mainly in Nordic equities and bonds. The fund applies negative screening for sustainability criteria and consequently avoids long positions in companies that produce tobacco, alcohol, commercial games for money, pornography, coal, or weapons. Derivatives are used in management to protect fund capital and increase return opportunities. The fund is expected to have low co-variation with performance in the equity, credit and bond markets and may thus both raise the expected return and lower the expected risk in a traditional equity and fixed income portfolio. In structuring the portfolio, strong emphasis is placed on spreading risk and preventing any individual holding or sector from having excessive influence on fund performance. Investments are based on fundamental analysis of individual companies and traditional macroanalysis. The fund's target is to generate annual return of 3-5% with a standard deviation of 3%.
We still believe that the large companies have performed a little too well in relation to medium-sized companies this year and therefore we have a long exposure to medium-sized vs large companies.
Fund manager comment
We are still cautiously positioned with lower net exposure and slightly less factor exposure than we have had historically. We still believe in a probability of slightly higher inflation and thus again rotation towards value shares in the medium term, but a lot has also been priced into the market and we believe that the pause for the theme will last for a while longer. We still believe that the large companies have performed a little too well in relation to medium-sized companies this year and therefore we have a long exposure to medium-sized vs large companies, however, we have done so with limited liquidity risk.
The Nordic stock markets climbed in June, the MSCI Nordic Index rose 2.3% in SEK and all stock markets rose. The Danish stock market did best, rising 4.9%, while Oslo and Stockholm rose by about 1% in SEK.
Rising inflation was a theme in the market for most of 2021, but took a break in June. Inflation expectations fell slightly in June. US timber prices, Chinese pulp futures, copper prices, etc. fell back during the month. Oil prices, on the other hand, continued to rise during the month and data for both inflation and wage increases remained high in the United States. As bottlenecks in the logistics and raw materials sectors look set to ease in the future and people return to the labor market, the market expects inflation to calm down again. With slightly lower inflation expectations and interest rates in June, the sector rotation reversed somewhat from value equities back to growth equities. We believe that there is still a risk that inflation will be a little more lasting, but that there will be a continued pause for the theme in the short term.
Catella Hedge fell -0.57% in June. The positive contribution came from long equity positions and credits with a negative contribution from primarily short equity positions but also from the index hedge. The best share position was a spread between the Kinnevik rights that were distributed for conversion to Zalando shares, and a short position in Zalando against. The Kinnevik dishes were traded at a discount, which the fund used. Good long positions were Tele2, Sdiptech, Electrolux Professional and Nordea. The losing list was also dominated by long share positions, such as SATS, Embracer, Ambea, Millicom and HM.
The risk and reward indicator illustrates the link between risk and potential returns from an investment in the Fund. The indicator is based on how the fund's value has changed over the past five years or the highest permitted risk for the fund. Category 1 does not imply that the fund is risk-free. Over time, the Fund’s risk indicator may change both upwards and downwards. This is because the indicator is based on historical data for the Fund’s model portfolio, which is not a guarantee of future risk/reward.
Catella Hedgefond fund's objective is to deliver consistent, positive returns regardless of stock market trends.
To make money in both market upturns and downturns, the fund managers invest in Nordic fixed-income securities and equities, and gain protection from downturns through derivatives. This means that timing is not an issue when investing in Catella Hedgefond, and low risk is a cornerstone of the fund. The fund is run by a total of four managers. The team's experience and knowledge generate the management performance.
The fund is traded daily, making your money normally available immediately. Over time, the fund has had a high risk-adjusted return. This is a fund for investors seeking a solid base for their savings.