Aphilion sfeer video
11 October 2019

Monthly Update: September 2019

SEPTEMBER HIGHLIGHTS

Global equities recovered in September thanks to some better economic data and a general feeling that interest rates globally and across the whole yield curve could remain negative to very low for a considerable time. The US and European central bank both cut rates and Quantitative Easing is back on the table in Europe.

 

Trade negotiations between the US and China, aiming to resolve their (many) trade disputes, seem to be near resolution and published economic data now point to a soft, but not recessionary, global economy.

 

The result is familiar: if stocks see no reason to go down, expansionary monetary conditions will always push them up.

 

Aphilion Q² - Equities
[long only global equity]
 
Our long only fund gained +2.6% in September, in line with the MSCI World Index (also +2.6% in EUR). The long-term track record of the fund (and the cornerstone of our strategies) remains excellent: an average annual return of +7.3% vs. +3.1% for MSCI World.
 
Aphilion SIF  L/S
[long/short eqty mkt neutral]
 
Aphilion SIF lost ground in September (-2.9%) in what on the surface looked like a very calm month, but underneath we saw very big relative moves among stocks, sectors and factors. The biggest loser was the so-called momentum factor. We don't target this factor directly either way, but it does creep into some of our strategies indirectly, and so we suffered.
 
Aphilion Q² - Balance
[hedged global equity]
 
Balance lost 0.2% the past month, with negative European interest rates a continuous drag on performance. The fund's performance relies on outperformance from the underlying Q² portfolio, and in the short term that will always be unpredictable.
 

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