- Advertisement -
- Advertisement -

New Fund Blossoms in Challenging Waters

- Advertisement -

Stockholm (HedgeNordic) – After rigorous backtesting and out-of-sample trading, Finnish asset manager Northern Star Partners launched trend-following fund NS Quant shortly before the coronavirus-driven market turmoil. The strategy has been up to the task, as NS Quant gained over ten percent in March and is one of this year’s best performers in the Nordic Hedge Index.

The recently-launched fund relies on an in-house developed strategy, also dubbed NS Quant, to trade liquid equity and commodity futures. The futures-based systematic long/short strategy is based on three interrelated models – momentum, trend, and quality check – to perform irrespective of the direction of broader markets. “NS Quant is a three-step quantitative model that generates entry and exit trading signals and continuously monitors whether the three models are in accord on open positions,” explains Markku Malkamäki, CIO at Northern Star Partners.

Senior Portfolio Manager Kenneth Barner-Rasmussen.

The momentum and trend models are two different, yet non-competing strategies that generate signals to buy on the upswing or sell on the downswing, serving to support or reject each other. The “quality check” model, meanwhile, “acts as a hurdle and is designed to either confirm correct trading signals or oppose false signals,” further elaborates Malkamäki. By maintaining only positions endorsed by all three models, “the strategy tries to eliminate false signals to optimize performance and minimize trading activity,” explains Senior Portfolio Manager Kenneth Barner-Rasmussen, who oversees NS Quant alongside CIO Markku Malkamäki and analyst Markus Malkamäki.

The NS Quant strategy “seeks to participate in uptrends, as well as limit exposure in downtrends or even make a profit out of downtrends,” says Markku Malkamäki, who used to run Northern Star MG Relative Value with Karri Lehtinen. Northern Star MG Relative Value, which was launched under the umbrella of Northern Star Partners during the summer of 2018, employed commodity option trading strategies. The volatility-based fund was closed down in January this year after struggling to perform because of low volatility and occasional sharp reversals.

In backtesting and out-of-sample trading, Northern Star’s NS Quant strategy “captured positive and negative price trends early across asset classes,” says Barner-Rasmussen. “The results from the NS Quant strategy shows that trend-following and momentum models yield results and simultaneously minimize trading activity.” NS Quant is the third-best performing fund in the Nordic Hedge Index in 2020 after gaining 11.6 percent in its first two months.

Welcome to the Nordic Hedge Index!

Subscribe to HedgeBrev, HedgeNordic’s weekly newsletter, and never miss the latest news!

Our newsletter is sent once a week, every Friday.

Eugeniu Guzun
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. Write to Eugeniu Guzun at eugene@hedgenordic.com

Latest Articles

Perfect Storm for Antiloop’s Strategies

Stockholm (HedgeNordic) – Since its launch in February 2022, multi-strategy hedge fund Antiloop Hedge successfully navigated turbulent waters with few surprises. The month of...

Asilo’s Path to Finding Tomorrow’s Superstars

Stockholm (HedgeNordic) – In contrast to benchmark-hugging managers, a truly active equity manager combines independent thinking, strong conviction, and a long-term perspective to generate...

Thyra Hedge Capitalizes on the AI Boom

Stockholm (HedgeNordic) – After experiencing both ups and downs in performance over the past few years, tech-focused long/short equity fund Thyra Hedge is enjoying...

Month in Review: High Dispersion Among Equity Funds

Stockholm (HedgeNordic) – Nordic hedge funds experienced an estimated decline of 0.8 percent in May (as reported by 86 percent of funds) amid high...

The Veritas Approach to Building a Well-Rounded Equities Portfolio

Stockholm (HedgeNordic) – Pension funds play a vital role in safeguarding the financial futures of millions of individuals. Equities serve as the cornerstone of...

Formuepleje Appoints Rasmus Cederholm as New CIO

Stockholm (HedgeNordic) – Danish asset manager Formuepleje has announced the appointment of Rasmus Cederholm as its new Chief Investment Officer (CIO), effective from September....

Allocator Interviews


Most Popular This Week


Request for Proposal

- Advertisement -