This week has seen a series of new fund launches by specialist investment managers to take advantage of opportunities in long-term trends including Uberisation of the economy.
Candriam Investors Group announced the launch of a new Digital Long Short Equity strategy. This strategy has been designed to invest in companies benefiting from the digital evolution of the economy by tapping into the growth potential of innovative companies and shorting disrupted companies, it says.
New thematic strategy
Candriam is a European multi-specialist asset manager owned by New York Life Investment Management (NYLIM). It describes this Digital Long Short strategy as the latest addition to its range of thematic strategies which already include demography, biotechnology and robotics. Thematic strategies allow investors to capitalise on long-term socio-economic trends, identifying losers as well as winners.
The new fund's investment mandate enables it to invest in digital champions over the long term and short companies which rely on legacy technology and have a negative profit momentum. It also implements opportunistic pair trades, a market-neutral strategy which takes no directional market risk. Stocks are selected from a worldwide equity universe, resulting in a high conviction portfolio with a maximum of 50 companies selected.
“The digital evolution of the economy is affecting all sectors and is pushing legacy firms to choose between transformation and economic death”, says César Zeitouni (pictured below), in charge of the new strategy. “Digital technologies are no longer confined to the technology sector, but are redefining sectors from banking, to retail, to automotive. In the current economy, we believe there is an “Airbnb” hidden in all sectors.
Uberisation of the economy
- technological innovation is happening at a speed that has never been observed before
- the first wave of disruptive technology from 2000 to 2015 saw the proliferation of high-tech devices such as smart phones and PCs
- in the current phase we are witnessing the Uberisation of the economy
Man goes long short standalone
Another long short strategy comes courtesy of Man GLG, the discretionary investment management business of Man Group. It plans to launch its UK Absolute Value Strategy on a standalone basis in June. Run as part of the Man GLG Alpha Select Fund for over two and a half years, it is lead managed by Jack Barrat. The strategy will focus on the mid-cap segment of the UK equity market.