Best Dualistic Portfolio Concept - Arena funds Global Macro

Hinder Asset Management

Our focus is on the active top down allocation, which can be empirically proven to be over 90% responsible for long term investment success. Hinder Asset Management has developed the innovative «Active Index Investing» concept. The implementation of our macroeconomical investment policy is almost entirely done with indices, and ETFs are our most prefered vehicles.The Fund’s objective is to achieve long-term above-average capital growth. It follows a combined global multi-asset and multi-strategy approach. Active currency overlay management is included but we typically hold a slight Swiss Franc bias.

The fund is best understood as two rather independent subportfolios that are both driven by the same fundamental research process. Ideas are mainly generated from a relative versus absolute trend divergence analysis. The first subportfolio seeks a broad diversification utilizing the core/satellite principle. This can result in significant over- or underweights to the benchmark. From a top-down point of view major asset class allocations have generally fluctuated within the following limits: stocks 20% to 100%, bonds 50% to 50%, commodities -10% to 25%, real estate -20 to 30%  and cash 0 to 65%. Positions are generally longer term with few tactical ideas ranging down to an investment horizon of  months or weeks only.

The second subportfolio invests in foreign exchange contracts and is mainly focused on G10 currencies, it incorporates leverage and follows an opportunistic trading strategy. The level of gross leverage has reached 3.5x in the past but its total allocation is always diversified over a number of trades and by nature spread into opposing currencies. Holding periods are generally of shorter term nature ranging to 3 months rarely. Arenafunds Global Macro makes use of a state of the art risk management systems that individually addresses both subportfolios and is able to calculate crucial metrics such as VaR, a wide number of risk scenarios and worst case analysis. All trades are subject to pre- and post- trade checks by our independent risk manager. Fills are double checked internally and externally as are our numerous investment restrictions at least on a weekly basis. We work with soft and hard stop losses. We invest only in the most liquid markets and all positions are selected such that they can be liquidated within 24  hours in almost any market condition.

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