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QQM: Systematic Market Neutrality with ESG principles

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Stockholm (HedgeNordic) – Stockholm domiciled QQM Equity Hedge is a systematic, equity-market-neutral absolute return fund based on proprietary quantitative models. The fund’s partners Ola Björkmo and Jonas Sandefeldt have been managing the fund since July 2010, refining the investment model and successively expanding the investment universe. The result has been reduced volatility and a significant performance improvement. QQM Equity Hedge has continuously posted strong performances over the last three years and is ranked as top 10 in the world in its category (Equity Market Neutral) by BarclayHedge over a rolling 3 years period from Q4 2012- Q3 2015. QQM Equity Hedge was also ranked top 10 for the single years 2013 and 2014.

The fund’s strategy is based on behavioural finance theory and its findings in terms of how investors make mistakes because of cognitive and emotional biases, resulting in the mispricing of assets. “The idea is to benefit from an understanding of what drives investor behaviour. Irrational behaviour by many individual investors causes mispricing and creates opportunities for others,” says Ola Björkmo, Partner and Managing Director at QQM Fund Management.
There are several drivers behind mispricing. Overconfidence is one of the more common failings that many individuals suffer from when making investments. Overconfidence often leads to trading too frequently. Confirmation bias is another, where investors use a form of selective thinking, seeking out information that supports their original ideas about an investment, and ignoring information that contradicts it. Anchoring is a third effect, where people tend to attach or anchor their thoughts around a reference point despite the fact that it may not have any logical relevance to the situation. “The costs of implementation can exceed the size pricing errors. Therefore, diligence is required and costs weighed against any possible revenue,” says Sandefeldt.

To read the whole interview in the HedgeNordic Special Report on market neutral strategies, please click here: Market Neutral Strategies 

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Kamran Ghalitschi
Kamran Ghalitschi
Kamran has been working in the financial industry since 1994 and has specialized on client relations and marketing. Having worked with retail clients in asset management and brokerage the first ten years of his career for major European banks, he joined a CTA / Managed Futures fund with 1,5 Billion USD under management where he was responsible for sales, client relations and operations in the BeNeLux and Nordic countries. Kamran joined a multi-family office managing their own fund of hedgefunds with 400 million USD AuM in 2009. Kamran has worked and lived in Vienna, Frankfurt, Amsterdam and Stockholm. Born in 1974, Kamran today again lives in Vienna, Austria.

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