Monthly Update: September 2017
September was an exceptional month for our long-only global equity fund: an outperformance of +0.8% vs its benchmark MSCI World Index. This takes our outperformance for 2017 to +1.9%.
The Balance fund aims to transform this outperformance into an absolute return and did so only partially, gaining +0.4% in September. The reason lies in the specifics of our equity market hedge. We hedge against the Eurostoxx 50 and the S&P 500, because the superior liquidity of these contracts far outweighs the increased 'tracking error' they have. But 2017 has proved to be a very strong year for the Eurostoxx 50: it's outperforming MSCI Europe by over 2.5%... and that costs Balance.
Aphilion SIF had a tougher month, shedding 0.5%, but with a pointed decrease in volatility. We put considerable research effort the past few months into lowering SIF's volatility, by matching ever more precisely the long and short (factor) exposures in the fund. We think we have made good progress here, thanks to effective proprietary risk models, an increased number of positions and more frequent rebalancing of existing positions. The ultimate aim is a higher Sharpe, and smaller drawdowns to help keep everyone on board!
More numbers and information can be found in the fund factsheets (available by clicking on the buttons above), on our website for the Q² funds, and on www.aphilion.com/SIF for our hedge fund (well informed investors only).
The past year has been a tough one for Aphilion SIF, but its long term track record remains such that the fund has been nominated by EuroHedge for outstanding performance in the "Global Equity" category over a period of more than five years. Winners to be announced in November!
Thank you for your continued interest and consideration,
Jan Holvoet, Nico Goethals, Xavier Boussemaere