Groupama Asset Managment has "not abandoned" long/short hedge fund strategies although it has shifted towards equity market neutral, said Henri Chabadel, the firm's head of Sigma Fund Management.
Groupama Asset Managment has “not abandoned” long/short hedge fund strategies although it has shifted towards equity market neutral, said Henri Chabadel, the firm’s head of Sigma Fund Management.
In January French group Groupama Asset Management announced it had radically adjusted the long/short strategy of Groupama Alpha Euro Stock due to unsatisfactory performance in recent months.
Alpha Euro Stock was a fund of funds launched in 2005. In a transformation that saw the fund take a new name, FCP Groupama Statique 2, it dropped its previous structure as an OPCVM (Ucits) in favour of becoming a fonds commun de placement (FCP).
This enabled the fund to invest up to 100% in other Ucits products, previously limited to just 10%. Meanwhile, it stopped investing in convertible bonds and funds following long/short strategies.
This implied Groupama AM had fallen out of love with absolute return funds, understandably given the rough year the majority of hedge funds experienced in 2011: the majority finished 2011 down nearly 9%, Hedge Fund Research data shows.
Yet according to Henri Chabadel (pictured), head of Sigma Fund Management at Groupama AM, the group simply decided to take a break from this particular fund of funds to prioritise other strategies. "We have not abandoned the idea of running equity long/short funds," he affirms.
Groupama AM in fact emphasises its continued interest in absolute return vehicles having launched G Fund - Alpha Equity Market Neutral in March last year. The fund is part of Groupama AM's newly launched Luxembourg Sicav, G Fund, which received regulatory approval from the Luxembourg authorities in December 2010. The Sicav was established as part of Groupama AM's plans to expand on an international scale.
The latest addition to the Sicav, Alpha Equity Market Neutral, was only launched once Groupama had found the right manager (Selim Boughalem) to lead the investment process. The fund invests between up to 100% in money market instruments and equities using market neutral and long/short equity strategies. Its aim is to outperform the EONIA + 2.5% by investing in equities making up the Europe TMI Stoxx Index.