Facebook Twitter Instagram
    • About
    • Subscribe
    • Contact
    • Report Library
    • Manager Login
    Facebook Twitter LinkedIn RSS
    HedgeNordic
    • Home
    • Allocator Angle
    • Report Library
    • Nordic Hedge Award
      • Nominations 2021 Nordic Hedge Award
      • Rookie of the Year
      • Jury Board
      • Historic Winners
      • Statistics
    • Nordic Hedge Index
    • Webinars & Podcasts
    HedgeNordic

    Catella’s Long/Short Equity Vehicle Overhauls Strategy

    Eugeniu GuzunBy Eugeniu Guzun11/03/2019No Comments
    Facebook Twitter LinkedIn Email

    Stockholm (HedgeNordic) – Catella Nordic Long Short Equity, just like many other long/short equity funds, delivered disappointing performance in 2018 following a challenging fourth quarter. After reshuffling the portfolio management team running the fund (read more details), Stockholm-based asset manager Catella decided to reorganize the fund’s strategy as well.

    Catella Nordic Long Short Equity predominantly invests in Nordic equities using a combination of fundamental and quantitative approaches. Launched in December of 2010, the long/short vehicle delivered an average annual return of 3.4 percent through the end of February despite experiencing a 13.8 percent decline in 2018. The fund’s net market exposure mostly hovered around 50 percent throughout 2018 up until the end of November, when the net exposure started to slide into negative territory.

    The reduced net market exposure in the latter part of 2018 was an early sign of coming plans to revamp the fund’s strategy. Starting from this year, Catella Nordic Long Short Equity aims to generate returns that are less dependent on the evolution of equity markets and exhibit less concentration of risk by maintaining an enlarged portfolio of holdings. According to Thomas Elofsson (pictured), one of the five portfolio managers running Catella’s long/short equity fund, “the current focus of the portfolio management team is to increase gross exposure, reduce net exposure and, more importantly, reduce correlation to equity markets.”

    From a purely risk-return perspective, nothing changes for Catella Nordic Long Short Equity. “The risk-return target remains the same as before, with the fund targeting an annual return between five and ten percent with an annualized volatility in the same range,” adds Elofsson. The fund now aims to run a near market-neutral portfolio, with the majority of the risk and return stemming from company-specific risk and individual stock picking rather than market directionality. “Investors should not expect the fund to have a strong long-bias over time,” warns Elofsson.

    The portfolio management team does not give up on their value-oriented approach to investing, but that does not mean the fund solely focuses on investing in companies trading at low valuation multiples. “We are fundamental investors. For us, the fundamentals are more important than just the numbers,” says Elofsson. “Our view of a company’s intrinsic value is based on valuation multiples, our views on future growth potential, the development of profit margins and structural changes, all these factors are essential for the fund’s positioning.”

    Commenting on the fund’s current portfolio, Elofsson says “we have a diversified portfolio comprised of long positions in companies we believe are attractively valued and short positions in companies with too high valuations.” Whereas valuation is an important parameter in the team’s decision-making process, “valuation is usually not enough to take a position,” reckons Elofsson.

    Following the recent adjustments to its strategy, the net market exposure maintained by Catella Nordic Long Short Equity has been fluctuating in negative territory in the past two months or so, which delayed a possible solid recovery after equity markets rebounded strongly this year. The changes, however, are likely to help get Catella’s fund back on track, as uncorrelated returns are increasingly sought-after following a decade of rising equity markets.

    Share. Facebook Twitter LinkedIn Email
    Previous ArticleLynx Regulatory Head Departs for New Role
    Next Article Nordic Winners at the UCITS Hedge Awards
    Eugeniu Guzun

    Eugeniu Guzun serves as a data analyst responsible for maintaining and gatekeeping the Nordic Hedge Index, and as a journalist covering the Nordic hedge fund industry for HedgeNordic. Eugeniu completed his Master’s degree at the Stockholm School of Economics in 2018.

    Related Posts

    One Nordic Cross Hedge Fund is Liquidating

    CTAs Starting Summer on a High Note

    Nordic Quant Funds Win Awards

    Add A Comment

    Leave A Reply Cancel Reply

    Time limit is exhausted. Please reload CAPTCHA.

    Most read today:
    • One Nordic Cross Hedge Fund is Liquidating
    • Janus Henderson Onboards Danske Bank’s EMD Team
    • Procrastinated Risk is Knocking on the Door
    • St. Petri Readying Launch of Long-Only Fund
    • AIFM Group Adds Art to Suite of Offerings
    • Head of Alts Jumps Ship to Join AP Pension
    • In-Depth: Inflation Protection

    Ukraine, Supply-Chain Shortages and Soaring Prices – Accelerators of Sustainable Development

    18/05/2022

    New Theme: Real Income Destruction

    17/05/2022

    Blockification

    16/05/2022

    The Inflation Puzzle

    12/05/2022
    Promotion:
    Video: Manager Interviews
    https://www.youtube.com/watch?v=tni7dQvQrmo

    Subscribe to our newsletter

    HedgeNordic: Your Single Access Point to the Nordic Hedge Fund Industry!

    Check your inbox now to confirm your subscription.

    Most read articles this week:
    • Janus Henderson Onboards Danske Bank’s EMD Team
    • One Nordic Cross Hedge Fund is Liquidating
    • AIFM Group Adds Art to Suite of Offerings
    • St. Petri Readying Launch of Long-Only Fund
    • Head of Alts Jumps Ship to Join AP Pension
    • Procrastinated Risk is Knocking on the Door
    • Recent
    • NHX
    • In Depth

    One Nordic Cross Hedge Fund is Liquidating

    30/06/2022

    St. Petri Readying Launch of Long-Only Fund

    29/06/2022

    AIFM Group Adds Art to Suite of Offerings

    29/06/2022

    Head of Alts Jumps Ship to Join AP Pension

    28/06/2022

    Month in Review – May 2022

    22/06/2022

    Month in Review – April 2022

    12/05/2022

    Follow Your Favourite Hedge Fund

    11/05/2022

    Month in Review – March 2022

    13/04/2022

    Ukraine, Supply-Chain Shortages and Soaring Prices – Accelerators of Sustainable Development

    18/05/2022

    New Theme: Real Income Destruction

    17/05/2022

    Blockification

    16/05/2022

    The Inflation Puzzle

    12/05/2022
    Newsletter Subscription:
    Most Recent Posts:

    One Nordic Cross Hedge Fund is Liquidating

    30/06/2022

    St. Petri Readying Launch of Long-Only Fund

    29/06/2022

    AIFM Group Adds Art to Suite of Offerings

    29/06/2022

    Head of Alts Jumps Ship to Join AP Pension

    28/06/2022

    Janus Henderson Onboards Danske Bank’s EMD Team

    27/06/2022
    Publisher

    Nordic Business Media AB
    Corporate No.: 556838-6170
    BOX 7285
    SE-103 89 Stockholm, Sweden

    VAT No.: SE-556838617001
    Tel.:+46 (0) 8 5333 8688
    Mob.: +46 (0) 7 06566688
    Email: info@hedgenordic.com

    STAY INFORMED

    HedgeNordic: Your Single Access Point to the Nordic Hedge Fund Industry!

    Subscribe to our newsletter:

    Check your inbox now to confirm your subscription.

    RSS Hedge Fund Job Digest
    • Fund Accountant 01/07/2022
    • Director of Business Development 01/07/2022
    • Assistant Fund Controller or Senior Associate 01/07/2022
    • Principal Technical Architect 01/07/2022
    • SQL Server DBA/Sybase ASE DBA 01/07/2022
    • Research Assistant - Equities 01/07/2022
    • Fund Accountant 01/07/2022
    • Associate - Investment and Operations 01/07/2022

    Copyright © 2022 Nordic Business Media AB

    © 2022 Nordic Business Media AB
    • About
    • Cookie Policy
    • Privacy Policy

    Type above and press Enter to search. Press Esc to cancel.

    We are using cookies to give you the best experience on our website.

    HedgeNordic
    Powered by  GDPR Cookie Compliance
    Privacy Overview

    This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.

    Strictly Necessary Cookies

    Strictly Necessary Cookie should be enabled at all times so that we can save your preferences for cookie settings.

    If you disable this cookie, we will not be able to save your preferences. This means that every time you visit this website you will need to enable or disable cookies again.