KLS Scopia Market Neutral Equity

Investment Objective

Scopia employ a fundamental equity Market Neutral strategy, with a core focus on underfollowed and under researched US mid-cap equities. The team have a multi-sector approach, focussing on consumer/retail, financials/business services, healthcare, industrials and technology/telecom. Scopia was founded in April 2001 and have employed the same consistent philosophy and approach over the entire duration of the firm. The fund seeks to generate 10% per annum, with low correlation to market indices.

Latest Meeting Note

Meeting 31 Jan 2024

Scopia believes that we are at an interesting juncture for the market, which should be relatively constructive for small and mid-cap equities, Scopia’s core area of expertise. The US economy is proving more resilient than expected and yi...

Scopia believes that we are at an interesting juncture for the market, which should be relatively constructive for small and mid-cap equities, Scopia’s core area of expertise. The US economy is proving more resilient than expected and yields have come down to reasonable levels, which should help bring Private Equity investors back into the market, who are themselves sitting on record cash reserves. This is against a backdrop that has seen record underperformance of SMID versus the broader market, leading to relatively unchallenging valuations across much of their core universe. The team is excited about their ability to hunt for long ideas given this secular undervaluation but are also observing plenty of expensive companies given strong price action in recent years. This large dispersion of valuation provides a very fertile ground for the strategy and alpha generation for both the long and short books. Moreover, the increasingly short-term focus of market participants is creating inexpensive optionality on intermediate-term catalysts, a core driver of idiosyncratic returns for the team.

Performance

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC YTD
2023 0.1 0.3 0.2 0.5 0.8 0.8 0.7 0.0 0.7 0.2 0.3 0.7 0.4
2022 0.3 0.8 0.9 0.2 0.5 0.2 0.3 0.7 0.8 0.2 0.7 0.5 0.6

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