Scientifically-approved alternative beta strategies

Capital Funds Management’s (CFM’s) CFM Institutional Systematic Diversified Trust A has a track record of successfully implementing alternative beta strategies, and president Philippe Jordan said there was no doubt this was the reason for the fund’s nomination.

“Alternative beta strategies, such as our CFM ISDiversified program, provide diversification and risk management benefits to a portfolio because they have historically maintained a low correlation to traditional markets over long periods, thereby meeting demand from investors for uncorrelated investment strategies,” said Jordan.

Jordan said CFM’s investment strategy is to provide a diversified portfolio across a range of robust, sustainable and scalable alternative betas, which are chosen using a quantitative, extensive, research-based approach.

Duly important to a bottom-up, scientific approach to strategy is a “collegial culture” within the funds team.

“Our approach is as team-based as it is scientific: we employ over 50 people in research, and over 80 in technology to develop and implement our strategies,” said Jordan.

Branding the fund “pioneers in alternative investment strategies”, Jordan said the fund is but one of only a handful of global investors to apply “rigorous academic techniques” to data using state-of-the-art technology.

The judging panel praised the French investment manager for its experienced team, the majority of whom have a background in physics and/or Ph.D.’s.

Favourable ratings from major research houses and the fund’s addition to many platform investment menus and approved product lists was also a key driver in the nomination, according to Jordan.

Partners Group Global Value Fund (AUD) was a finalist in the category, and senior vice president, Jonathan Abraham, credited strong returns to attractive investment strategy that has remained unchanged. 

Macquarie’s Winton Global Alpha Fund was also a finalist in the category, with head of investments at Macquarie Professional Series, Luke Crozier, crediting a proven track-record of delivering performance, maintaining lower volatility than global and Australian equities, and experiencing shorter and shallower drawdowns.


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