Picking the right managers in the AltUcits space: tips of a French expert

As the alternative Ucits space welcomes ever more strategies, operating fund selection in the universe has become more challenging.

This is the feeling of Paris-based Vincent Batailler (pictured), managing partner of alternative investment advisory and due diligence firm Iodda Advisors he founded in 2016.

Batailler shares with InvestmentEurope tips to help picking the right managers in the altUcits universe. Iodda Advisors’ founder has been navigating in the space for a long time, having previously served as head of Alternative Investments at Vega Investment Managers, part of Natixis Group, and held a number of roles linked to the derivatives universe.

A crucial advice Batailler gives is beware of the way alternative Ucits indices are built.

“The more different the index constituents’ investment processes are, the more important are the chances the portfolio you get will be meaningless and thus useless. We all read and heard that 2016 was a bad year for Equity Market Neutral managers. It is devoid of meaning,” Iodda Advisors’ founder says.

According to him, the real deal in the altUcits space is to know your portfolio manager and go beyond the traditional due diligence.

“The Ucits stamp does not exempt you from leading your own operational due diligence. How independent from the investment manager is the fund board of directors, the custodian(s), sub-custodian(s) and the fund administrator? Who deals with risk management?

“How demanding is the compliance policy? What does the disaster recovery plan look like? And, should the fund be onboarded on a platform, how the platform and the investment firm do share the coverage of the different areas (risk, compliance, reconciliations, …) and how things are carried out?” Batailler points out.

To read more about Vincent Batailler’s tips on altUcits managers’ picking, click here.

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