The in the first of a new series, Citywire Selector speaks to top selectors on what managers, strategies or ideas are currently standing out in their portfolios.
Selector: Florian Groschl
Company: Absolute Return Consulting (Austria)
Active managers had a very difficult year and the performance was perhaps the worst we have seen since 1999. This means there was a need to find new managers able to generate alpha even in these difficult circumstances. Long/short equity managers suffered even though you would expect to find managers able to give portfolios a boost.
There was no real decisive reasons for funds doing well or not doing well over the past year but one thing that did benefit investors was being able to adapt quickly to changing market environments. There was talk of growing interest in quant-backed and systematic areas but I found a stand-out manager in long/short equity.
Over the past year we invested with James Inglis-Jones of Liontrust, who runs the GF European Strategic Equity fund with Samantha Gleave. I had not come across him before but he had an interesting take on the European market and was approaching it in a way I had not encountered before, which was focused on cashflow investments.
We moved into the fund in October, so relatively new, but the timing has been good, as markets have decorrelated and the short book is working well. That is the benefit of people a smaller player, such as ourselves, in that you can say: “Is the timing okay?” and if you think so, you act immediately and lock it in, rather than waiting for sign-offs and the opportunity may have passed. This is difficult though, as not all long/short managers have been able to generate alpha in such a way.