LONG-SHORT FUND - May 25'
Long-Short Fund is a dynamic investment vehicle that commenced operations in October 2023 employing a Long Short strategy, specializing in US Equity assets.
The Long-Short Fund, launched in September 2023, utilizes an active and innovative approach to investment management. Its primary aim is to achieve superior risk-adjusted returns while maintaining a strong commitment to ethical and sustainable investing. This report outlines the fund's performance, the adjustments made to enhance returns, and its approach to navigating current macroeconomic conditions. The fund’s strategy involves leveraging both long and short positions to exploit market inefficiencies, and it remains dedicated to delivering absolute returns with a focus on sustainability.
The fund's objective is to generate higher risk-adjusted returns through a 60:40 allocation between long and short positions. It primarily invests in equity markets across developed regions, focusing on industries with strong growth potential or mispricing opportunities. The fund uses a quantitative multi-factor model to evaluate stocks based on value, quality, momentum, and volatility, ensuring more consistent and disciplined decision-making. Additionally, the fund adheres to strict ESG criteria, excluding companies involved in unethical practices and ensuring that investments meet a minimum ESG score of 55/100 according to FactSet. The AQR Long-Short Equity Fund serves as the benchmark for performance evaluation.
The Long-Short Fund has outperformed its benchmark, the AQR Long-Short Equity Fund, with a return of 10.09% compared to 9.77% from the benchmark. Key contributors to this performance include strong long positions in Palantir, Mercado Libre, and Uber, as well as successful short positions in Nikola and Beyond Meat. Notably, the short position in Nikola yielded a full return of 100% after the company filed for bankruptcy. However, the fund experienced losses in positions like Alphabet and Kirkland’s, with the latter benefiting from a turnaround strategy. The fund’s performance highlights its ability to navigate market fluctuations and capitalize on both growth and defensive opportunities, aligning with its strategy to balance risk and return.