The Hedgeweek Interview: Eduard Seligman-Schürch, CEO, Osprey Asset Management: Targeting opportunities in a volatile market
Geneva-based Eduard Seligman-Schürch outlines the background and thinking behind the launch of his new product, The Shearwater Fund.
HW: What is the background to the new fund?
E S-S: The Shearwater fund, a Cayman Island hedge fund, was launched in October 2005. The seed money for this fund has been put up by Family and Friends. The principal (myself) who is also the manager has invested the major part of his personal wealth into this venture. It started with a little more than CHF 1.5 million. By the end of February 2006, the NAV increased by over 25 per cent and the AUM increased fivefold. The fund is on track with its business plan.
HW: How and where do you distribute the fund? What is your current and targeted client base?
E S-S: The fund is currently aimed at High Net Worth Individuals or/and institutional investors who are looking for a diversification of their portfolio in a lateral / volatile or regressing market. Due to its very low correlation to the Stock-Exchanges as well as its specific positioning, the Shearwater Fund is well suited for such diversification as its wealth creation power is the highest in a volatile stagnant and volatile regressing market. The fund is also registered with the German Tax authorities allowing investments from Germany without any negative tax consequences.
HW: What is the investment process of your fund?
E S-S: The investment decision is performed solely by the Hedge Fund manager (myself). Investment process is based on a strategy developed over time by the principal and third parties. This strategy takes into account a quantitative approach, a qualitative approach (macro), market timing, seasonality and technical analysis.
HW: How do you generate ideas for your fund?
E S-S: The positioning of the fund does not implies systematically new ideas, it rather works on market biases which are triggering events.
HW: What is your approach to managing risk?
E S-S: Risk consciousness, risk awareness, risk understanding and risk control is by far the most important and crucial activity within the Fund. I believe very strongly that it is potentially quite undemanding to generate absolute return, but it is very challenging to generate an optimal and highly competitive risk adjusted return.
HW: How/against what do you benchmark the performance of your fund?
E S-S: The Shearwater Fund does not measure itself against any benchmark or and index. Its main objective is to generate a constant return of 25 per cent per year.
HW: Has your performance been as per budget and expectations? Do you expect your performance or style to change going forward?
E S-S: Current performance is slightly ahead of expectation as we are targeting a yearly net performance of 25 per cent which has been achieved already after 5 months. Evolution in terms of AUM is in line with expectation. We strongly believe that our current investment strategy has an ongoing material potential, even so this strategy is fined tuned each and every day.
HW: What opportunities are you looking at right now?
E S-S: We are currently studying all the opportunities which could potentially arise from the currently very low volatility environment which we are experiencing. We suppose volatility is at present at historical lows and may raise in 2006, thus providing the Shearwater Fund with great investment opportunities.
HW: What events do you expect to see in your sector in the year ahead?
E S-S: We think about positioning the fund so as to generate an additional return in case of increased volatility.
HW: How will these changes/future events impact on your own portfolio?
E S-S: We do not believe that this will affect the portfolio.
HW: Do you have any plans for similar/other product launches in the near future?
E S-S: We have currently no plans to launch other products.
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