Hedge Fund Awards 2016

Hedge Fund Awards 2016 21 Unique Company History Based on Long Term Hedge Fund Experience Ayaltis’ company history provides leads to a better understanding of this key connotation. The company was founded in 2008, which was a challenging time to raise assets, being in the midst of the financial crisis. On the investment side, however, Ernesto Prado, the Chief Invest- ment Officer of Ayaltis, was convinced that the global deleveraging posed a unique investment opportunity. The firm’s two partners, Son Nguyen and Ernesto Prado, have had a long standing history in working together prior to joining forces to set up an enterprise. Moreover, both have been dedicated to the hedge fund field in their previous career paths. Having a strong pedigree within the hedge fund space, especially in the underlying asset classes, was paramount when it came to hiring the team members. Since 2008, the team has consistently grown and counts 12 employees at the end of December 2015. Despite the difficult environment, Ayaltis raised assets under management to the current level of USD 800m. The core of the client base is situated in Switzerland. While this will always remain the firm’s home turf, their investor base has expanded into Europe, the Middle East and Asia. Ayaltis’ focused business model is compelling to investors: The sole interest of the company is to provide fund of hedge fund products, which are managed in a transparent manner. Truly independent of any financial institution, the two founding partners hold the majority stake in the company. A Swiss family office is a key shareholder and acted as a seed investor. De-Correlation is the Key to Portfolio Management The concise product range encompasses three funds alongside the firm’s flagship fund: Areca Value Discovery. The flagship fund shows an impressive annualized return of 7.84% with a low standard deviation of 4.23% over its seven year life span with a correlation of almost zero to any asset classes. Areca Liquid Focus benefits from the rich opportunities in the liquid hedge funds universe. Narrapuno Spectrum has a concentrated and best of ideas portfolio. Narrapuno Convergence is a thematic fund focusing on direct lending. The investment approach is of course consistent across all portfolios and this is where the relative value component becomes evident: the emphasis within portfolio construction is on a sophisticated risk premia model, which focusses on correlation of the single hedge funds to the portfolio. The return expectation of the funds is put into a “relative value” context. The set-up of Areca Value Discovery substantially differs from many mainstream fund of hedge fund products in the sense that it does not follow a rigid, predefined style allocation. On the contrary, the funds are truly flexible to shift to the best opportunities within the hedge fund uni- verse. Ernesto Prado, CIO, has proven more than once his ability to identify turning points in the market and to position the portfolio in the optimal way to benefit from these market opportuni- ties. Driven by a fixed income mind-set, he holds the core principal at heart the “relative value” theme and therefore, reflecting a conservative investment style. The due diligence process is constructed to isolate managers, who excel in risk management and who are able to deliver fixed income like protection with equity upside. The predominant goal is to build a stable portfo- lio, where the single components complement each other. A Few Words on the Prevailing Environment The tremendous regulatory changes which were initiated after the financial crisis definitely had a lasting impact on the hedge fund industry overall. While the sentiment was for a long time very critical towards fund of hedge funds, investors’ interest has rebounded. The uncertainty of the economic environment poses challenges, which require experts. In late 2014, Ayaltis started to reposition the portfolio to deal with this elevated market volatility. Positions in structured credit, which were a core component earlier on, were continuously reduced. Hedge fund managers with a more liquid and market neutral stance now strongly contribute to the sound return fig- ures. Relative value is again the main tenor. Company: Ayaltis Email: [email protected] Web: http://www.ayaltis.com/ Address: Lavaterstrasse 101 8002 Zurich, Switzerland Telephone: +41 43 501 37 60