Funds in focus

 

Equity returns achievable despite market volatility

 

While equities made a reasonable start to the year, there is still a great deal of uncertainty. The trade dispute between the USA and Europe remains unresolved, China’s economy is hanging in the balance, and Brexit is threatening to descend into chaos. Nevertheless, the defensive equity strategy of the Lupus alpha All Opportunities Fund – a long-short strategy with a track record stretching back over more than ten years – offers an opportunity to remain committed to European small and mid caps with limited risk.

 

Stay flexible with a defensive equity strategy

Long-short equity strategies such as the Lupus alpha All Opportunities Fund can remain flexible in both rising and falling markets and profit from the wide array of opportunities that arise, regardless of overall market trends or a benchmark. Lupus alpha’s strategy enables investors to exploit the potential of European small and mid caps without being exposed to the full risk of an equity investment. Using a combination of various individual strategies and building blocks also means that the portfolio manager can implement ideas that would not be feasible within a traditional long-only strategy.

 

Equity over- and undervaluations can be profitably exploited using pair trades or opportunistic long and short positions. In addition, investments can be made targeting particular events or situations referred to as 'special situations', including spin-offs, dividend strategies or IPOs. If necessary, the portfolio can be hedged against falling prices or the equity exposure reduced. The strategy has a long-term market beta of less than 30 per cent overall. Each individual investment idea is analysed separately using its risk-reward ratio and is only implemented with careful assessment and conviction.

 

Chart: Long-short exposure over time

 

 

 

 

Source: Lupus alpha, own calculations; as at: 28/02/2019

 

The strategy of the Lupus alpha All Opportunities Fund is particularly suited to investors who want to benefit flexibly from the opportunities of small and mid caps and thereby seek a more defensive and adaptable strategy (low beta approach).

 

Team expertise

Lupus alpha All Opportunities Fund's low-beta strategy makes use of Lupus alpha's highly specialist expertise in the small- and mid-cap segment:

 

  • Large European small- and mid-cap team with nine specialists
  • Many years of experience and an exceptional track record
  • Wide range of monitored stocks/companies
  • Detailed knowledge gained from approximately 1,000 points of contact with companies each year

“Participate in the alpha potential of European small and mid caps thanks to a targeted combination of long and short investments with lower variation.”

 


For fund details and performance information for the Lupus alpha All Opportunities Fund, click here.


 

Talk to us about your goals, and we can work with you to provide tailored access to this attractive asset class. Our experienced Clients & Markets team is always on hand to provide further information or for one-to-one discussions. Call +49 69 365058-7000.

 

New asset classes as of 29 April 2019

 

Lupus alpha All Opportunities Fund A

 

WKN: A0Q7VN, ISIN: LU0381944619

 

Management fee 1.8%, performance fee 20%, no minimum investment amount

 

 

 

Lupus alpha All Opportunities Fund C (previously B)

 

WKN: A0M99W, ISIN: LU0329425713

 

Management fee 1.0%, performance fee 20%, EUR 500,000 minimum investment amount

 

Portfolio Manager

 

 

 

Franz Führer

 

Partner, Portfolio Management Small & Mid Caps Europe

Franz Führer has been working in portfolio management for Lupus alpha for more than 15 years, since 2019 as a partner. As a specialist in the Small & Mid Caps Europe team, he is responsible for the strategic management of the Lupus alpha All Opportunities and Lupus alpha Smaller Euro Champions funds. He began his career at Lupus alpha in 2001 after completing his studies in economics. As a student, he