Emergence and NewAlpha Asset Management (NewAlpha) have made a strategic investment in Fideas Capital (Fideas) with Emergence’s long-only European equity sub-fund investing EUR35 million in Fideas’ quant-driven European equities fund.
Fideas’ smart beta range of funds have seen assets under management double in the last two years and the firm now manages over EUR400 million.
This ‘smart beta’ investment process aims to minimise volatility by focusing on individual risks that are weakly correlated. Fideas believes this approach optimises the risk reward properties of the portfolio by effectively reducing the global risk of the portfolio without having to miss out on the high return potential of volatile assets.
Fideas’s strategy involves the firm distancing itself from the weightings of the MSCI index, while allocating its portfolio to indexes covering countries and sectors from the Eurozone and not to individually selected shares. This allows Fideas to restrict the ‘stock’ specific risk and to avoid a ‘small caps bias‘, which is very common in other active quantitative portfolio management strategies.
