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OQAM Chooses New Roadmap

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Stockholm (HedgeNordic) – Despite delivering on its promise of preserving capital in this year’s market environment, Malmö-based OQAM has closed down its multi-strategy systematic hedge fund ia. Instead, OQAM will open up its innovation engine by offering individual strategies to other financial institutions and professional investors either through discretionary mandates or fund structures.

“In consultation with our investors, the decision to liquidate ia was both made and implemented during October,” Andreas Olsson, the Co-Founder and CEO of OQAM, tells HedgeNordic. “Since the start almost four years ago, ia has been managed with an insufficient level of assets to cover the costs of the fund’s operations,” he elaborates. “We are closing the fund to focus on launching other investment products that we’ve developed, most of which are sub-models that we’ve been running within ia.”

“We are closing the fund to focus on launching other investment products that we’ve developed.”

ia’s Two-Fold Objective

The team at OQAM had two main objectives for ia upon its launch in late 2018: to represent an investment product with an attractive risk-return profile and serve as an innovation engine. “We definitely felt that ia had a very specific return profile that we believed professional investors needed in their portfolios,” says Olsson. With ia’s multi-strategy approach aiming to deliver returns in both risk-on and risk-off environments, OQAM had capital preservation and uninterrupted compounding at the heart of their philosophy. ia delivered a cumulative return of 6.7 percent since launching in December 2018 after edging down only 0.4 percent in 2022.

“The return profile has been achieved in different periods, perhaps the most important and challenging periods, but not if you look over the entire lifespan of the fund,” acknowledges Olsson. “It hasn’t been a bad investmentfor anybody, we just haven’t achieved the goals we aimed for,” he continues. “The investors haven’t been losing money with their investments in ia, but as a small player, you need better performance than that to grow your assets and to sustain a good business.”

The second objective of using ia as an innovation engine, however, has been achieved. “Over these years, we have researched and in most cases implemented more than 50 alphas,” says Olsson. “We have built operations, technology and a platform around these models,” he continues. “And since ia has been sub-scale, we decided to close down ia to give a chance to these other business opportunities that we have been working on for quite a long time. The closure of a sub-scale ia is just about enabling us to dedicate resources to new investment strategies that we believe have a good opportunity going forward.”

“The closure of a sub-scale ia is just about enabling us to dedicate resources to new investment strategies that we believe have a good opportunity going forward.”

ia used to combine around 20 different models across four broader strategy groups, including asset allocation, short-term trading, trend strategies and relative-value strategies. “Other financial institutions and professional investors may lack the know-how to run some of these strategies both from an investment, operational and technology perspective. We could hopefully come in and offer a suitable strategy with much shorter time-to-market in a more cost-efficient form,” explains Olsson. “Whether that is being done in a fund structure or through a discretionary mandate, that is something we will have to see.”

OQAM is currently working on launching its first product following the closure of ia. “One of the investment strategies we are moving ahead with is capacity-limited in terms of managed capital to maximize the opportunities for an attractive risk-adjusted return,” says Olsson. “Therefore, we will not launch it as a fund but in another more cost-effective structure and to a limited number of investors,” he adds. “We want to get some more pieces of the puzzle in place before saying more about the other strategies.

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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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