Azabu Value Partners (Cayman) has launched the Azabu Value Master Fund, a Japan-focused fundamental equity long/short strategy under the umbrella of Rogers Investment Advisors.
The fund is managed by June-Yon Kim and Oleg Zuravljov, former Fidelity Japan colleagues with nearly four decades of combined experience in Japanese equities.
Michael O’Flynn, head of business development and a long time financial markets veteran, serves as managing director of Azabu Value Partners (Cayman), the general partner of the fund.
The fund employs a fundamental bottom-up strategy, investing in Japanese larger capitalisation stocks. The strategy is enhanced by a derivative overlay and seeks to deliver returns not correlated with the underlying market. The key differentiating feature of the strategy is its focus on identifying value opportunities in the context of Japan’s pronounced economic and equity market cyclicality.
Goldman Sachs and Morgan Stanley are to serve as prime brokers of the fund. Operations and risk management functions are provided by the Rogers Investment Advisors platform in Tokyo.
“We believe that our approach, focusing on fundamental bottom-up research enhanced by a top-down assessment of the macroeconomic and market cycles, allows us to take advantage of the significant dispersion of equity returns typical for Japan and to achieve consistent absolute returns regardless of the general direction of the Japanese equity market,” says Kim.
Zuravljov adds: “Japan is probably the most cyclical developed market in the world. Fundamental stock pickers in Japan often ignore this powerful phenomenon. We believe that looking at individual stocks through the prism of macroeconomic cyclicality creates exceptional opportunities and reduces risk.”
“I think what we are trying to do at Azabu Value is unique,” says O’Flynn. “Japan is a deep and liquid developed market with emerging market-like inefficiencies which, when combined with our team’s decades of stock-picking expertise, will offer investors more opportunities to obtain alpha on both the long and the short side, as compared to the far narrower nature of markets across the rest of Asia.”
Edward Rogers, chief executive officer of Rogers Investment Advisors, adds: “We are pleased to help launch the Azabu Value Fund on the Rogers IA platform. For quite some time we have seen significant value added by equity long/short managers who base their research effort in Tokyo. Given the exceptional investment pedigrees of both June and Oleg we expect this fund to quickly distinguish itself with superior performance.”
