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%.
Tendencies towards increased inflation in the economy, not least driven by commodity inflation and high container freight rates, has also been an important theme and was a driving force during the first half of January for sector rotation.
Fund manager comment
Catella Hedge rose by +0,47%. The largest positive contribution came from the credit side together with long positions, while short positions and index futures contributed negatively. Best equity position was CDON which rose by +101% during January and contributed 0,38% to the fund's performance. Second best was Sdiptech which also performed strongly with +15%. Among the shorts A.P. Möller – Maersk contributed when the share fell at the end of the month, on signs that freight rates were flattening or starting to fall. The worst position was the short position in EQT that rallied on a good report and an acquisition of a property platform, the rise was amplified and exaggerated compared to what is fundamentally motivated by short positions and underweights in the share. The worst long position was Chemometec that was hit by sector rotation. Even if we are lightly positioned sector and equity wise for a higher inflation, an opening of society after Corona and a certain degree of recovery, Chemometec is a share that diversifies away some of that risk. Lately, we have conducted a bigger project on factor risks in order to avoid the fund being negatively impacted by future potential non beneficial sector and factor rotations.
The Nordic exchanges climbed marginally during the month of January, MSCI Nordic Index rose by +0,7% in Euro and +1,7% in SEK, but the development was mixed. The worst performance was the Danish bourse which fell 3,1% while other indices rose somewhat. In Stockholm the big cap index OMX rose by +3% while the broader index rose only marginally.
News flow was eventful with the storming of the Capitol, continued Corona lockdowns, slower pace of vaccinations than that was hoped and of course company reports. But from the market's perspective the big news was the Reddit-driven short squeeze in shares of GameStop, AMC Entertainment, Blackberry, Nokia and at the end of the month also the silver market.
This resulted in big losses for primarily some American hedge funds and they had to take down risks dramatically. A big reduction in gross exposure from hedge funds led to volatility at the end of the month. Tendencies towards increased inflation in the economy, not least driven by commodity inflation and high container freight rates, has also been an important theme and was a driving force during the first half of January for sector rotation. Reports have in general been good, many companies have during 2020 reduced costs while during Q4 have been helped by pent up demand that has come back.
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.