30th July, 2020

Q2-2020 Swiss-Asia Communication

Well well well, who would have thought that the COVID19 pandemic would have brought the world to a complete travel standstill and many businesses associated with tourism and travel to a grinding halt with continued work from home, mask-wearing and social distancing becoming a norm for most others (at least in Asia). In Singapore, we have seen a 41% decline in Q2 GDP and at the same time, global stock markets are not too far from their pre-pandemic highs. Totally unprecedented and unchartered.

During these times, Swiss-Asia has continued to operate seamlessly with all staff still operating remotely from home and plans to continue so until most restrictions lifted. We generally note that productivity has increased and our investments in Technology have now proven their worth and paid off. We are also currently engaging further cloud-based investments that will not only streamline our internal operational processes but also focus on client/investor experience.

SWISS-ASIA PLATFORM FUNDS PERFORMANCE SNAPSHOT

The Q2 leaderboard is amazing in many ways, the recovery speed of the market was as swift as the market downturn and we saw some exceptional returns over the second quarter and for the first half of the year. Below we show the Q2-2020 leaders. We have sorted by Q2-2020 performance and we decided to add a little more granular data (Q1-2020 and YTD) to demonstrate the volatility that the managers had to endure over the first half of this year.

We can see that the long only managers have staged a comeback in Q2, which is to be expected of course. Vanda and Prulev both demonstrated skill as they fought back the Q1 blows. Prulev being close to it’s High Water Mark again with only a 3-month trough to near-peak.

FUND NAME FUND STRATEGY CCY Jan-20 Feb-20 Mar-20 Q1-2020 Apr-20 May-20 Jun-20 Q2-2020 2020 YTD
Agathis Managed Account Long Only Equity USD -0.70% -12.79% -15.10% -26.48% 21.84% 4.39% 14.28% 45.34% 6.86%
Vanda Global Fund Class A Global Macro USD 4.54% -11.90% -45.74% -50.03% 16.76% 9.13% 12.35% 43.16% -28.5%
Prulev Globe Fund Class B Global Macro USD 8.97% 0.40% -34.54% -28.38% 22.69% 5.42% 7.04% 38.45% -0.9%
LTCP FUND SP Class A Long Only Equity Global USD -1.69% -9.84% -31.06% -38.89% 13.42% 9.06% 4.53% 29.29% -21.0%
Music Finance Note 1 Fund of Fund USD -2.34% -4.59% -9.90% -16.05% 6.82% 6.54% 9.74% 24.89% 4.9%
Coprossa Investment Fund Clas Long / Short Equity JapanEquity Asia USD 2.27% -0.20% 3.14% 5.28% 2.00% 5.68% 5.24% 13.44% 19.4%
Inclusif Value Fund Class A Long Only SGD -3.58% -4.34% -12.39% -19.19% 8.68% 1.45% 1.45% 11.86% -9.6%
Shenton Global Dividend Fund Long Only Equity USD 0.33% -3.80% -11.80% -14.88% 6.94% 3.41% 0.08% 10.67% -5.80%
Heritage Global Capital Fund Class A Long Only Equity SGD -4-83% -1.58% -11.07% -16.71% 4.74% -1.49% 4.91% 8.25% -9.84%
Umapan International Fund Long Only Equity USD -5.86% -8.92% -17.11% -28.92% 5.76% 1.66% -0.69% 6.78% -24.10%

On the Digital side of things, the Eurekahedge Crypto-Currency Hedge Fund Index was up 26.8% for Q2-2020 on the back of a very strong recovery in April. Bitcoin gained 42.4% over the same period. CryptoCurrency HF Index: Q2 +26.8%, YTD +24.1% Bitcoin: Q2 42.4%, YTD 28.6%

CRYPTO FUNDS FUND STRATEGY CCY Jan-20 Feb-20 Mar-20 Q1-2020 Apr-20 May-20 Jun-20 Q2-2020 2020 YTD
Kernel Fund SP Crypto Arbitrage USD -2.22% 1.38% 5.98% 5.15% -1.24% 0.49% 0.83% 0.08% 5.13%
Acuity Class A Crypto Arbitrage USD - 2.12% 12.34% 14.46% 1.33% 1.66% 1.38% 4.37% 19.81%
BTCX 100 Fund (Not yet Started Trading) Long Only BTC Tracker USD - - - - - - - - -
EurekaHedge Crypto Curr, Hedge Funds INDEX* USD 19.38% 0.16% -18.13% 1.41% 21.84% 5.69% -1.87% 26.8% 23.68%

*The Eurekahedge Crypto-Currency Hedge Fund Index is an equally weighted index of 9 constituent funds. The index is designed to provide a broad measure of the performance of underlying hedge fund managers that allocate to bitcoin and other crypto-currencies. The index is base weighted at 100 at Jun 2013, does not contain duplicate funds and is denominated in USD.

FUND PLATFORM DEVELOPMENT

AMB International SPC – Megatrend Trading SP

Launched in July, the AMB Megatrend Trading fund is a fully systematic medium-term trend following system that uses multiple derived data sources including both publicly available and proprietary data sets to algorithmically execute its trading strategy. Typically, the fund will look to minimize positions in ranging markets and then enter positions in trending markets to maximize returns at these times. Annually the fund will target 10-15% returns but these will typically be achieved by lower average monthly returns and several larger monthly returns when the markets are trending. The fund will run tight stops on individual positions, only increasing position sizes once trades are already onside and do not expect to hold offside positions for a long period of time. Typical leverage is 3-5 times. The Portfolio Manager, Anil Mulchand Bahirwani, is a successful Indonesian business entrepreneur and investor. He has over 25 years of business experience culminating in building the AMB Group of companies comprising AMB Financial, AMB Property, AMB Lifestyle and AMB Strategic Investments. With his strong financial and business acumen, Anil Bahirwani successfully built Indonesia’s largest Forex, Commodities and Derivatives Broker. In 2012, Anil Bahirwani went on to build Surya Anugrah Mulya as a leading Market Maker for financial trading activities. After having over 20 years of experience in the financial service industry and learning about pitfalls of retail trading, managing liquidity and various other edges, he developed his own trading system though automatic trading and stringent risk management systems. Today he has built a professional team with strong domain expertise to run his trading portfolio with a successful track record.

Woodlands Investment Partners

The Woodlands team have launched a series of Managed Accounts on the Swiss-Asia platform in Hong Kong over the course of Q2. The team is also anticipating a Fund launch as soon as when the COVID19 situation subsides and they can get out there and start talking to their investors. The team wishes to remain discreet in the first months of their operations. We will surely be sharing more information and news on the team in the next updates.

WEALTH MANAGEMENT DEVELOPMENTS

Arranging of Life Policies

Swiss-Asia is happy to announce that it can now advise on any life insurance products that are issued by registered insurers and whom SAFS has an agreement with. Advisers may advise their clients to purchase life policies from unregistered overseas insurers only upon approval of the MAS. Life insurance products could entail products such as whole life insurance, term insurance, endowment insurance, life annuity, investment-linked insurance and universal life insurance. We are also permitted to arrange insurance covers for our clients alongside dispensation of any advice relating to such insurance coverage.

FEATURED FUND

This quarter, we feature the Ddraig Equity Fund which is designed to outperform the MSCI World Net Total Return Index. The fund enhances returns from its core equity investments by employing a market-neutral relative value strategy, receiving income from a covered-call option strategy against the core equity holdings, and invests in protection hedging against steep market declines.

I have selected it this month because it has shown some real resilience to market volatility – the strict risk management via buying protection and sticking to their guns has paid off by alleviating volatility and maintaining a serious lead to it’s benchmark over the first half of the year. See below for comparison to it’s Benchmark.

FUND FUND STRATEGY CCY Jan-20 Feb-20 Mar-20 Q1-2020 Apr-20 May-20 Jun-20 Q2-2020 2020 YTD
Ddraig Equity Fund Absolute Return Equity USD -0.22% -2.28% -4.01% -7.05% 1.63% 2.64% 0.02% 4.29% -2.89%
MSCI World Total Return Index USD -0.61% -8.45% -13.23% -21.05% 10.92% 4.83% 2.65% 19.36% -5.77%

The Ddraig Fund Managers are Chris Jones and Peter McDermott. Chris Jones has managed absolute return and enhanced equity hedge fund assets since 2004, prior to which he has served as both a long-only fund manager on the buy-side with Hill Samuel Asset Management, and a research analyst on the sell-side of the industry with Citigroup. Since 2006, he has headed up two successful hedge fund management teams. Based out of Singapore, both teams were nominated for the Asian Multi-Strategy Fund of the Year by AsiaHedge. His experience also includes establishing and running the Asia offices of Concordia Advisors and later on as Head of Asian Multi-strategy Equities for Henderson Global Investors. Peter McDermott is a derivatives specialist since 1986. His experience runs from being an options market-maker on the London International Financial Futures Exchange (LIFFE) through to risk management and product development. He brings a strong risk control focus to the entire investment process. Please do reach out to us if you wish to learn more.

On behalf of the Swiss-Asia team we would like to extend a big THANK YOU all our Managers and the support teams for their dedication and hard work during these challenging and trying times. As I like to say; “This too shall pass”* !

Steve Knabl

*Wikipedia; “This too shall pass” is a Persian adage translated and used in multiple languages. It reflects on the temporary nature, or ephemerality, of the human condition. The general sentiment is often expressed in wisdom literature throughout history and across cultures, although the specific phrase seems to have originated in the writings of the medieval Persian Sufi poets.
It is known in the Western world primarily due to a 19th-century retelling of Persian fable by the English poet Edward FitzGerald. It was also notably employed in a speech by Abraham Lincoln before he became the sixteenth President of the United States.