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Atlas Hit by Russian Exposure

Report: Systematic Strategies

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Stockholm (HedgeNordic) – Themes-focused hedge fund Atlas Global Macro, co-managed by Danish CIO Lars Tvede and portfolio manager Jakob Due, had exposure to Russian securities as part of a commodity “supercycle” theme. As a result of shuttered markets and worldwide sanctions imposed after Russia’s invasion of Ukraine, Atlas Global Macro’s entire exposure to Russian securities has been deemed worthless by its independent administrator, hitting the fund’s performance by six percent. Atlas Global Macro is now down 11.6 percent this year through March 30.

Atlas Global Macro’s administrator, an entity under Credit Suisse called MultiConcept Fund Management S.A., held a meeting in their pricing committee and decided to re-evaluate the pricing of Russian exposure within all funds under their umbrella structure. “As Atlas is administered by MultiConcept, this also impacts the NAV of Atlas,” writes the team at Atlas Global Macro. “More specifically, it was decided to value the fund’s exposure to Russian equities to zero, which subtracts around 6pp.” The fund’s entire Russian exposure via exchange-traded funds (ETFs) is now worth zero.

“It was decided to value the fund’s exposure to Russian equities to zero, which subtracts around 6pp.”

Launched in May of last year, Atlas Global Macro is a global macro-focused fund based on themes. One of the themes reflected in the fund’s portfolio since inception has been a long-term commodity “supercycle,” which Danish entrepreneur and author Lars Tvede expects to last between five to ten years due to the massive underinvestment in the physical economy. “We have been invested in this commodity theme since the beginning of the fund, but unfortunately Russia has also been part of this theme and therefore the fund’s investment exposure given the country’s large production of oil, gas, metals and minerals,” wrote the Atlas Global Macro team back in March.

“The updated pricing can be seen as an absolute ‘worst-case scenario.’ The ETFs will be valued at zero until they start trading again.”

“The underlying equities are again actively traded on the Russian exchange indicating potentially significant positive impact for the NAV of Atlas,” writes the team at Atlas Global Macro. “However, given current trading and settlement restrictions applied by the EU, US and Russia, our Administrator finds it most prudent to apply the most conservative pricing methodology,” the team adds. “Hence, the updated pricing can be seen as an absolute ‘worst-case scenario.’ The ETFs will be valued at zero until they start trading again.”

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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

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