In response to increased market demand, Fairtree has launched two new Hedge Funds.
The Fairtree Jackalberry Equity Long Short SNN Retail Hedge Fund (RHF) was launched in August 2019 and the Fairtree Marula Equity Long Short SNN Retail Hedge Fund (RHF) was launched in November 2019.
Both of Fairtree’s Retail Investor Hedge Funds (RIHF), developed out of a need to establish retail investment products for Fairtree’s growing number of retail clients.
Both funds are focused on extracting alpha returns predominantly from the South African equity market. These returns are accessed through a fundamental understanding of South African instrument’s stocks, economic growth and broad economic themes, as well as medium and long-term relative valuation opportunities.
The majority of the funds’ investments will be large and liquid stocks. The aim is to identify high quality businesses through their strategic competitive advantage, strong management teams and resulting strong cash flow generation. An active management style will assist in taking advantage of mispriced opportunities as well as manage risk.
The Jackalberry Fund is a directional long short hedge fund, consisting predominantly of listed South African shares.
“Most hedge funds compete with a cash benchmark. The Jackalberry is unique since it competes with Capped Swix. It competes with traditional long only funds, but has more tools to work with. We can use leverage to enhance returns and we also have the ability to short shares, to capitalise on falling share prices,” said Fairtree’s Equity Portfolio Manager Cornelius Zeeman.
The Marula Fund is an equity long short hedge fund, employing relative value opportunities combined with directional strategies.
“The Capped Swix hasn’t delivered positive real returns over the last five years. The Marula gives investors exposure to the equity market, but we can deliver attractive absolute returns, irrespective of the direction of the market,” Zeeman added.”
The two new RHF’s will be managed by Fairtree’s award winning team consisting of Andre Malan, Kobus Nel, Deon Botha and Cornelius Zeeman. The fund will be managed alongside the Fairtree Equity Market Neutral Hedge Fund.