According to Anson Funds, the key to navigating the present market environment is to be nimble and adapt the investment and risk management approach to changing circumstances.
According to Anson Funds, the key to navigating the present market environment is to be nimble and adapt the investment and risk management approach to changing circumstances.
Moez Kassam, CIO, Anson Funds, says: “With the rise of the retail investor and the extreme moves that so-called ‘meme stocks’ have experienced, prudent risk management processes have become increasingly important to ensure that market actors have enough protection against downside scenarios, which can emerge with alarming speed.”
Strategies
To achieve its record-breaking performance over the last two years, Anson Funds has relied upon the diversity and versatility of its multi‐strategy approach. Anson Funds utilises several different investment strategies that thrive during different market environments – longs (tactical equity and REITs), shorts (momentum reversals and fundamental shorts) and opportunistic (structured financings, SPACs & catalyst driven investing).
Kassam says: “We have been able to harness the opportunities available to us in the overall market environment that manifests in any given period of time. Then, as market sentiment changes, we have successfully been able to pass the baton on to other strategies that are better suited for the new reality. This sounds easy to do retrospectively, but it requires significant skill and discipline to execute in real-time when market signals are still clouded with significant statistical noise.” Each of Anson Funds’ sub-strategies generated strong returns during the past year, but some performed better at different times of the year than others.
Best Equity Hedge Fund – Secret to success
Kassam adds: “The secret to our success is that we are market agnostic. We invest enormous resources, both in terms of human capital and of machine intelligence, to understand the directional contours of the market at any given time, and then adjust our investment approach accordingly.”
Anson Funds has learned that markets, and individual stocks, can act irrationally for long periods of time due to the combination of extremely loose fiscal and monetary policy, and the rise of the retail investor. Firms need to be willing to take losses and move when things don’t go their way.
Looking ahead
Going forward, Anson Funds believes that more volatility is in store for markets. “Many new funds have juiced returns in this period through some combination of leverage and extreme concentration,” Kassam said. “That kind of strategy works until it doesn’t, and then the bottom can fall out of a fund’s performance.” The key, he believes, is to play the long game. “Our investors are looking to compound wealth over the long-term. This is our responsibility as stewards of their capital.”
| AUM | |
| Anson Investments Master Fund US | USD880m |
| Anson Firmwide | USD1.35bn |
| Returns | |
| 2021 YTD | +44.3 per cent |
| Inception to Date (Jul 2007) | +731.7 per cent |
| Annualised | +15.8 per cent |
Moez Kassam, CIO, Anson Funds
As Chief Investment Officer of Anson Funds, Moez Kassam advises all funds under management and is responsible for investment strategy, trading and overall investment performance. An active philanthropist, Kassam sits on the boards of the Toronto Library Foundation, the Canadian Olympic Foundation and Ryerson University’s Technology Innovation Circle. In 2018, Moez was named in Canada’s Top 40 Under 40 for extraordinary achievement in both business and philanthropy. Kassam holds an MBA from London Business School and a BA from the University of Western Ontario.
