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Alternative Market Briefing

The Corona Fighters Report 10: Asset managers that delivered in the downturn

Friday, April 17, 2020

Bailey McCann, Opalesque New York:

Amid the current market turmoil, this is our regular report on hedge fund managers who are bucking the trend.

Prior issues: Report 1; Report 2; Report 3; Report 4; Report 5; Report 6; Report 7; Report 8, and Report 9

Tech, TIPs and gold

Troy Asset Management is eying technology stocks, TIPS, and gold as it navigates market volatility. In a performance note to investors reviewed by Opalesque, the firm said that tech stocks are likely to remain sources of return throughout the crisis and beyond. The firm is also using TIPS and gold as a hedge against falling interest rates. Cash is likely to have its value eroded if rates drop further and gold could prove to be a return driver.

Troy's multi-asset Trojan Fund ended the month -1.7% compared to the FTSE All Share Index which was down -15.1%. Personal Assets Trust total return was -2.0% compare to FTSE All Share Index total return which was -25.1%. "Elsewhere at Troy our equity funds have outperformed their respective benchmarks," the firm said in the note.

Fintechs drive return

Manole Capital Management which runs two strategies devoted to investing in Fintechs, saw both programs end March on a positive note. The Manole Fintech Fund was up 0.15% in March and is up 6.62% year to date. The Manole Market Neutral Fintech Portfolio ended March up 5.20% and is up 15.37% year to date.

The Manole Fintech Fund is a long/short hybrid hedge fund, that owns both public and private Fintech companies. The market-neutral fund runs a concentrated portfolio focusing on fintechs that have predictable free cash flow and transaction-based business models.

According to a performance update to investors reviewed by Opalesque, the Fintech Fund built its largest ever short book last month and has continued to flatten its portfolio into April. "For the month of March, +15 basis points of absolute positive performance isn't a tremendous return. However, it sure beats the alternative of losses," the update said.

Small and mid-cap stocks on the rise

Pearl Brook Capital Management beat its benchmarks for the Pearl Brook International Alpha Fund in the first quarter. The fund is -1.44% year to date compared to the MSCI Global Small/Mid Index which is down -28.31% and the MSCI International Small Cap Index which is down -29% YTD.

According to a performance update to investors reviewed by Opalesque, the fund maintained its typical 20%-30% net exposure, with 150+ equity positions across longs and shorts.

Pearl Brook expects that the virus will usher in a new and somewhat permanent era of virtual living that will reshape society in fundamental ways. "Covid-19 will act as the biggest catalyst for reshaping international politics and trade flows since the world wars," the update said.

Pearl Brook PM Dr. Indraneel Das was featured on Opalesque TV in 2018.

And others...

German CTA Catana Capital's Overlay Strategy was up +22.6%, according to a performance update reviewed by Opalesque. The strategy is a customized overlay that uses DAX futures to create a consistent source of return.

***

Disclaimer: This is not investment advice. Opalesque has not verified this information and gives no warranty of accuracy or completeness. Past performance is not indicative of future results. See our Terms & Conditions for more information.

***

WEBINARS:

- The Corona Fighters: Meet the asset managers that delivered during the meltdown

Episode 1: Monday, April 20th, 10 am EST

Opalesque will present several investment managers who will give a succinct presentation on how and why their strategies delivered positive returns and/or protected during the Corona led market meltdown, with Q&A session.

For investors only - register now as seats are limited: www.opalesque.com/webinar/corona/

- COVID-19 Survival Training for Family Businesses April 15th, 10 am EST

Register:www.opalesque.com/webinar/covid_survival/

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