The RWC Global Growth Absolute Alpha fund has renamed the RWC Global Innovation Absolute Alpha fund in order to better describe the opportunity set. There is no change to the fund’s focus or investment process.
Fund manager, Priya Kodeeswaran, believes the way absolute return funds generate alpha is more important than which market they do it in as their net exposure to that market is generally fairly low. The team looks to outperform by investing in the part of the market where the risk/reward is highest irrespective of location. Kodeeswaran feels strongly that the optimal hunting ground is found where a large disagreement from the sell side resides and where companies are rapidly changing and innovating. Given this belief, the fund normally has exposure to areas such as TMT and Consumer Discretionary stocks, wherever they are in the world. As such, RWC Global Innovation Absolute Alpha is a more descriptive name for this process and what investors are buying.
Priya Kodeeswaran, manager of the fund, says: “Our core philosophy is to focus on change and evaluate when those changes are mispriced by the market. Currently, noticeable shifts in global central bank policies are causing macro level changes in FX and risk premiums that are not yet reflected in consensus estimates and market valuations. We feel as a geographically unconstrained long/short fund, we are ideally positioned to take advantage of these recent changes opportunistically whilst focusing on global sectors where the potential for alpha is greatest.”
At the end of the first quarter of 2015, the approximately $60m RWC Global Innovation Absolute Alpha fund was up +4.52% net of fees and since inception (February 2010) it was up 32.9% with a volatility of 6.4%*.
James Tollemache, Head of Sales, says: “If investors are using long/short equity funds such as the RWC Global Innovation Absolute Alpha in their alternative portfolios, we feel they should provide a source of alpha rather than just a way to reduce beta.
“By looking at sectors where innovation and change is high whilst not limiting themselves to one particular region allows Priya and his team to focus on high conviction ideas, whilst limiting drawdowns. This fund is more concerned about the way alpha is generated rather than where it is sourced.”