Global hedge fund adviser Sussex Partners has launched Strategic Certificates on the Sussex Partners Diversified Alpha Index issued and administered by Vontobel in both EUR and USD. The product, is based on the Diversifying Alpha Strategy developed by Sussex Partners, a core uncorrelated strategy it has been implementing in different formats for its advisory clients through bespoke structures, and which has performed positively so far in 2020, including during the March sell-off. The aim of this strategy is to produce diversified returns with a low beta and low correlation to traditional markets, targeting mid-high single digit returns in all market environments while providing positive return convexity in periods of market dislocation. The strategy has been implemented prior to the current crisis in other formats by Sussex Partners clients seeking to diversify their traditional and alternatives portfolios in deference to a less certain major market environment, particularly around equities and credit.
The Strategic Certificates represent the first co-mingled product advised by Sussex Partners which is accessible to a wider group of institutional investors. The actively managed certificates provide daily liquidity and are being launched with USD26 million of assets from leading Swiss-based wealth managers.
Patrick Ghali, Managing Partner of Sussex Partners, says: The launch of the Strategic Certificates through Vontobel allows smaller institutional investors, clients unable to directly invest in single manager hedge funds/UCITS funds, as well as external investors, for the first time to access our Diversifying Alpha Strategy, which was previously only available to our large advisory clients.
“Many of our clients shared our concern for some time that markets were getting extended and were looking for a genuine alternative to traditional market exposure that can provide downside correlation benefits as well as upside convexity in a dislocation. Importantly, these clients also sought to have exposure to an all-weather strategy that provides an acceptable return in all paradigms. It was with this philosophy in mind that we developed the Diversifying Alpha Strategy for our clients some time ago, and we are excited to be able to offer this to a wider client base through the launch of the Strategic Certificates on the Sussex Partners Diversified Alpha Index issued through Vontobel.”
