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 the Catella Nordic Long/Short Equity fund is to deliver competitive returns regardless of market conditions.
The fund invests mainly in Nordic equities. 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, over time, to have low co-variation with the equity market and may thus both raise the expected return and lower the expected risk in a traditional equity and fixed income fund portfolio. The portfolio is structured in two parts, consisting of long and short equity positions respectively, which are both expected to contribute to the fund's characteristics while jointly creating a favourable balance between risk and return. Investments are based on a combination of traditional equity research and quantitative methods. The fund's target is to generate annual return of 5-10% with a standard deviation of 5-10% over time.
Read more information regarding changes of portfolio management responsibility.
December was generally a strong month for world stock markets following the US-China trade deal. The generally upbeat risk sentiment raised market interest rates somewhat.
Thomas Elofsson, 2019-12-31
Fund manager comment
The performance of Nordic equity markets was mixed in December, and the Stockholm exchange (OMX total return) rose 3.6% including dividends. The small caps index (CSX) put on a better show and rose 5.2%. December was generally a strong month for world stock markets following the US-China trade deal. The generally upbeat risk sentiment raised market interest rates somewhat.
Catella Nordic Long Short rose 0.34% this month. The main positive contributors to the month’s return were the long positions in SSAB, Swedbank and Nordea. The short positions in Evolution Gaming, Nibe and Castellum had a negative impact. In terms of sectors, the fund has an overweight in banking and insurance and materials, and an underweight in industrials. One common denominator behind these positions is our assessment of their valuations. Valuation as a factor did not work during 2019, which negatively affected the fund’s return, but for 2020 we expect a return to the historical norm where undervalued companies provide a positive relative return compared to more expensive companies. This should take place irrespective of the general market trend. Gross exposure at the end of the month was 134 % and the net exposure was 0 %.
Fund facts
Risk Indicator
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. Category 1 does not mean that the fund is risk free. The fund may over time move towards the left or right of the scale. This is because the indicator is based on historical data which is not a guarantee of future risk and reward. For information about the risk classification of each fund, please refer to the fund’s key investor information document.
Fact
Catella Nordic Long Short Equity is an alternative equity fund with a Nordic focus that can perform in both upturns and downturns. It has lower risk than the stock market and should deliver a competitive return. The fund is managed by our hedgeteam.
The fund is suitable for investors seeking equity exposure with the opportunity to also make money in a falling stock market.
The fund is permitted to use derivatives and to have a larger percentage of the fund invested in bonds and other debt instruments issued by individual central government and municipal authorities and within the EEA than other securities funds.
Target return: Absolute return with a good risk-adjusted return
The fund is a Luxembourg-listed daily traded UCITS fund. The minimum deposit is 100 SEK/10€.
