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Matthias Knab, Opalesque for New Managers:

Episode 20 of Opalesque's flagship Small Managers - BIG ALPHA webinar series brought together four boutique investment managers who have each found a distinct path to generating alpha independently of broad market direction. The session drew participants from 24 countries, spanning single family offices, multi-family offices, pension funds, foundations, and sovereign wealth funds. Watch the full replay at https://www.opalesque.com/webinar/#pw92.

Ironshield Capital: Battle-Tested Market Neutrality in High Yield Credit

Frits Lieuw-Kie-Song, Portfolio Manager of the Ironshield High Yield Alpha Fund, opened the session with a compelling case for global high yield credit as a misunderstood and under-appreciated asset class. Founded in 2007 and based in London, Ironshield was launched by David Nazar, who brings over 25 years of high yield and special situations experience from Bank of America and Deutsche Bank. Lieuw-Kie-Song himself has managed global market-neutral high yield portfolios for over 20 years, previously at Allianz Global Investors where his strategies regularly ranked in the first quartile.

The Ironshield High Yield Alpha Fund, launched in August 2022, targets 6-7% net returns in euros per cycle with a strict market-neutral mandate. Lieuw-Kie-Song explained the mechanics clearly: when equity markets sold off roughly 10% in recent weeks, high yield typically falls 3.5-4%, and the fund's hedging construct - combining short positions on high yield indices with short equity index exposure and out-of-the-money put options - is designed to produce a flat or positive return in exactly that scenario. In the recent stress period, the fund generated approximately 60 basis points of positive returns, and is annualizing around 6% net since a strategy refinement last July.

The portfolio holds around 60 issuers, split roughly equally between Western Europe and the US, with a 3-12 month holding period and a long carry position of approximately 450 basis points. Rather than relying on interest rate views, Lieuw-Kie-Song focuses on the structural dispersion created by the four distinct investor classes in high yield - insurance companies, pension funds, retail investors, and hedge funds - each with different objectives, creating a constant source of mispricing to exploit. Current themes include shorted building materials names in the US, fiber infrastructure as an AI-driven scarcity play, and a European financial company he believes is burning cash and will need to return to equity markets.

"Experience dictates outcomes," Lieuw-Kie-Song said in the Q&A. "David and I have successfully traded through the dot-com bubble, the great financial crisis, and subsequent crises in the same strategy. That is battle-tested."

Amfileon AG: Statistical Arbitrage Built on Collaboration and Crisis Alpha

Dr. Sebastian Helmensdorfer, founder of Amfileon AG, presented one of the more unusual origin stories in the boutique space. The firm was founded in 2021 and financed from the outset by the German family office QUANT Vermoegensverwaltung, whose asset owners charged Helmensdorfer with building a liquid alternative that would make money on average but perform reliably in equity market crises - without adding interest rate correlation.

The answer was a quantitative statistical arbitrage platform built over roughly four years of development before live trading began. The firm's edge, Helmensdorfer argued, is structural: Amfileon operates with a compensation model where 50% of the firm's bottom line belongs to employees with a three-year lockup, explicitly designed to enable free knowledge-sharing across the team - unusual in a sector where proprietary know-how is typically hoarded. The result is a senior investment team where each member has 15-20 years of relevant experience.

The current portfolio runs 9-11 heterogeneous strategies across global liquid equities, with thousands of positions at any given time, an average holding period of one to two days, and full beta or dollar neutrality at the strategy level. Every strategy uses equity index futures for hedging where applicable, with strict constraints on position sizes and correlation.

Helmensdorfer used closing auction market-making as an illustrative example: the strategy provides liquidity to exchange closing auctions, where 10-50% of daily volume now transacts (a share that has grown with the rise of index-tracking products). Because positions must be held overnight once the auction closes, high-frequency traders cannot operate there - creating a structural sweet spot for Amfileon. Performance data shows strong positive returns in high-VIX regimes, consistent with the crisis-alpha mandate. The strategy is fully implemented on swap and portable as an overlay.

On capacity: Helmensdorfer confirmed that stat-arb strategies are inherently capacity-constrained, and that current capacity is full - but he expects meaningful free capacity to open up before year-end.

Asia Frontier Capital: The Last Uncovered Equity Universe

Ruchir Desai, co-Portfolio Manager of the AFC Asia Frontier Fund, made a persuasive case for a corner of global equity markets that remains almost entirely off the radar of large institutional investors. Asia Frontier Capital was established in 2013 by Thomas Hager and manages approximately $120 million across four funds, including country-dedicated vehicles for Vietnam, Uzbekistan, and Iraq.

The AFC Asia Frontier Fund invests exclusively in listed equities across Asian frontier markets - countries either in the MSCI Global Frontier Index's Asian component (Bangladesh, Pakistan, Sri Lanka, Vietnam, Kazakhstan, Oman) or entirely outside any index (Mongolia, Iraq, Uzbekistan). The universe covers a combined population of 770 million people and a combined GDP of approximately $2.6 trillion.

The core investment thesis rests on several pillars: extreme under-research (Goldman Sachs and JP Morgan do not cover stocks in Bangladesh, Pakistan, or Vietnam), low valuations (the fund trades at a P/E of just 7.3x - near its all-time low - while Indian equities trade above 20x), strong demographic tailwinds, domestic consumption growth, and supply-chain relocation benefiting Bangladesh (now the world's second-largest garment exporter after China) and Vietnam (the number-one garment exporter to the US, with exports nearly tripling since 2017).

Since inception in March 2012, the fund has returned approximately 125% in US dollar terms. Over the last three years - through the pandemic aftermath, the Ukraine war, aggressive Fed tightening, and Middle East conflict escalation - the fund has annualized close to 21% per year. Annualised volatility since inception is just 10.6%, below all major emerging and developed market benchmarks cited. Correlation with the MSCI World is 0.5, while individual frontier country correlations are far lower (Bangladesh at 0.04, Iraq negative).

Desai illustrated the opportunity with Lucky Cement in Pakistan, the fund's second-largest position: accumulated since 2019 and especially in 2023-2024, the stock has returned approximately 460% in dollar terms since March 2023. Portfolio turnover remains below 20%.

In the Q&A, when asked to compare the fund with Mark Mobius's Templeton Emerging Markets Group, Desai was direct: "We only invest in Asian frontier markets. That is our edge. We can invest in companies with a market cap of $100 million. Templeton cannot. That is exactly how we make alpha."

Althera42: Royalties as a New Private Markets Asset Class

Dr. Christian Czernich, founder of Althera42, presented what he described as the natural evolution of his decade-long work building private market royalty funds. His previous fund reached close to EUR 200 million in AUM across 39 investments in nine European countries with 13 exits. Althera42 takes that experience into technology companies specifically.

The concept is straightforward: rather than taking equity or providing debt, Althera42 acquires a percentage of revenue from private technology businesses - typically mid-market companies with EUR 30-100 million in revenues. Royalty rates typically run 3-8% of revenues, collected monthly and distributed to LPs quarterly. Rights can be acquired for up to 20 years, with multiple earlier monetisation pathways including secondary sales and securitisation.

Czernich's argument for why royalties suit the new tech economy is compelling: the old industrial economy ran on physical assets, high marginal costs, cyclical revenues, and high capex. Today's economy is driven by software, data, and embedded workflows - businesses with nonlinear scalability, low marginal cost, low working capital, and recurring contractual revenues. "We are still using the credit models of 100 years ago and trying to apply them to these new businesses," he said. "That does not make sense."

The strategy is self-selecting for quality: companies with high growth prefer royalties over equity because the dilution from equity becomes more expensive as performance improves. Three target pillars are enterprise and digital infrastructure (cybersecurity, payments, developer ecosystems), software and hardware with embedded recurring revenue models (robotics, automotive software), and energy transition technology. Target returns are 12-18% net.

On why no one had built a tech royalty fund before, Czernich said: "Royalty underwriting requires specific know-how that very few people have - and those who have it were almost exclusively in healthcare. The European tech sector is also barely 20 years old. It simply wasn't ready until now."

The Althera42 team includes partner Krinzel Shah, with 20 years in private and public markets across Morgan Stanley, Deutsche Bank, Royal Bank of Canada, and most recently as CIO of a major single family office in London, and COO/CFO Duncan Tennant, formerly of Sequoia Capital, Permira, and Generation Investment Management.

Watch the Replay

All four presentations, including the live Q&A session, are available in full at: https://www.opalesque.com/webinar/#pw92.

See here for a quick navigation the time codes (min:sec) of the individual presentations:

1. Intro: 00:05
2. Frits Lieuw-Kie-Son: 03:58
3. Dr. Sebastian Helmensdorfer, CFA: 16:32
4. Ruchir Desai, CFA: 29:31
5. Dr. Christian Czernich: 42:24
6. Q&A: 55:19

The next Opalesque webinar "Profiting from Panic: Portfolio Strategy for Volatile and Failing Markets" will feature a strategy that returned +27% in Q1 2026 with a multi-decade track record - focusing on how to capture alpha when beta fails. Secure your spot here: https://www.opalesque.com/webinar/.

This coming live session contains advanced concepts and is intended for sophisticated investors only. A user-friendly video replay will be provided. Past performance of any strategy discussed does not guarantee future results.