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%.
Our exposure has remained cautious, but tactical purchases in engineering and in the steel and mining sector helped the return during the month.
Fund manager comment
January was characterised by a strong recovery for global stock markets following the weak trend throughout the fourth quarter. Nordic indexes rose between 4% and 8% during the month. The stock market upturn is largely explained by the reversal in monetary policy announced by the Federal Reserve at the end of December and in mid-January, combined with the pendulum having swung too far in one direction in terms of sentiment and market positioning. Macroeconomic data, both official statistics and barometers, continued to notch up weak numbers on a broad front in all major regions. Given the weaker real economic outlook, stock market profit estimates were also revised downwards – which continued even during a relatively benign reporting season. Catella Hedgefond rose by 0.74% in January, primarily driven by the fund's long shareholdings. The biggest contributors were SSAB, a position established during the fourth quarter, and Boozt, which presented surprisingly good numbers for the quarter. On the negative side, Ovzon dropped steeply in connection with the implementation of the new share issue expected at the IPO.
In January, we continued to reduce less-liquid holdings in energy and oil services. Our exposure has remained cautious, but tactical purchases in engineering and in the steel and mining sector helped the return during the month. With the stock exchange's valuation back in the range that prevailed before the market slump, we believe it is wise to have a cautious approach to further risk-taking − even though we are slowly and methodically building up the gross exposure from low levels. With regard to individual long-term exposures, it is gratifying that Boozt, which we are still optimistic about, was able to report such a rapid recovery in profitability during the fourth quarter. Ambea has now completed the merger with Aleris, which suggests an exciting 2019. After strong relative performance during Q4, the share has given some ground at the start of this year but we still see significant upside.
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 five 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.
Prizes and nominations:
- Best Hedgefund 2015- Fondmarknaden.se
- This years Hedgefund 2014 - Privata Affärer
- Best Hedgefund 2014- Fondmarknaden.se
- Nominated Euro Hedge Awards 2014
- Nominated Nordic Hedge Award 2014
- Nominated Investors Choice European Multi Strategy Fund of 2014