Investment Objective

The investment objectives are to achieve consistent capital growth on low volatility and independent of equity market movements utilizing a European based equity long-short strategy with a short to medium term trading focus and an investment process that combines fundamental, technical and systematic techniques.

Latest Meeting Note

Meeting 14 Apr 2021

The Velox Fund (UCITS) was launched in April 2016 and has been run in a pari passu offshore format since January 2015, with its origins dating back to the PMs time at Marble Bar Asset Management in the early 2000s, where the strategy was... Read more

The Velox Fund (UCITS) was launched in April 2016 and has been run in a pari passu offshore format since January 2015, with its origins dating back to the PMs time at Marble Bar Asset Management in the early 2000s, where the strategy was initially seeded. The fund is an equity long-short market neutral strategy that targets a net return of 6-9%, with a volatility of 2-5%. Typical gross exposure ranges from 150-180% with the net sitting +/- 10%. At the heart of Velox is the identification of repeatable patterns of behaviour. It is the PMs belief that human behaviour creates ascertainable circumstances that lead to market mispricings, and the impacts of emotions (fear, greed, hope, panic) can be sourced in the market, with the team building investment strategies around these behaviours and patterns. The portfolio is constructed from six underlying trading strategies, managed by different members of the investment team, owing to their specialisms and experience. The strategies are; results/shocks (moves pre/post earnings), fundamental, capital markets (new issues, placings, IPOs), event driven (special situations, corporate actions) technical moves (breakouts, mean reversion), arbitrage (dual listings, spreads). Across all strategy’s idea generation is price lead before information is overlaid through five lenses (technical analysis, catalysts, sentiment, fundamentals, ESG) to build conviction and judge timing. ESG integration has progressed significantly in recent years, spearheaded by Saarthak Chhabra who previously lead the development of Bloomberg’s ESG tools. Velox have created a bespoke traffic light system consisting of industry specific material risk factors and a company’s revenue share from unethical or controversial practices. The system allows the team to understand and mitigate any unwarranted risks arising from ESG factors, therefore helping reduce the portfolio volatility, whilst also helping to generate ESG alpha signals based on ESG events and themes. As well as considering ESG risks, overall risk management is central to the strategy, with capital preservation at the core of decision making and each PM has a tailored risk framework built around their individual strategy. Furthermore, an optimised hedging process ensures the book is taking on more stock specific risk instead of being dictated by factors. Another risk management (and return generating) tool is the dynamic allocation of capital across strategies, which enables the fund to take advantages of opportunities, seasons and momentum.

Performance

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC YTD
2020 0.5 0.2 0.6 0.4 0.1 0.7 0.6 0.0 0.7 0.3 0.8 0.9 0.8
2019 0.2 0.0 0.6 0.2 0.9 0.1 0.4 0.3 0.5 0.9 0.1 0.2 0.1

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Close Current Site Absolute Hedge is a market leading UCITS research database providing proprietary research on funds, themes and strategies in the UCITS space. Kepler Trust Intelligence is produced by the investment companies team at Kepler Partners and is the UK’s premier source of detailed qualitative research on investment trusts. Kepler Liquid Strategies is a Dublin domiciled UCITS fund platform featuring a number of best-of-breed fund managers. Kepler Partners is a corporate advisory and asset raising boutique specialising in the regulated funds market in Europe and investment trusts in the UK.