The investment process draws from both top down and bottom up considerations. From a macro point of view, close attention is paid to cyclical developments, especially interest rates, in the world economy along with aggregate and sectoral valuations. From a stock-specific point of view, the focus is on valuation where we have developed our proprietary screening model, management quality, competitive position and news flow. Besides relying on in-house research, the investment process is enriched by contacts with companies, policy-makers and sell-side analysts.
The Fund's gross exposure is usually in the region of 120% and rarely exceeds 150%. The portfolio is generally made up of 40 to 60 positions with 10 to 20 major positions accounting for between 40% to 80% of the NAV. Most positions are in large capitalization stocks as liquidity is a key priority. Several risk control mechanisms are in place, including net and gross exposure monitoring (effective and volatility adjusted), DVAR, preparation of contingency plans, elaboration of detailed daily profit and loss reports, and independent and systematic control from prime brokers.
Returns reported net of all fees. No hurdle rate. Redemptions require 10 days advance notice.