MPG divests Vita Nova Hedge Fund out of equities
• MPG sees substantial market correction, at very least
Managing Partners Group, the international asset management group with a base in St Julian’s, has almost divested its Vita Nova Hedge Fund entirely out of equities in anticipation of a substantial correction, or worse.
The Fund’s equity exposure is now limited to a small number of holdings that will be exchanged for short-dated debt securities to lock in value, secure a reasonable yield and enable redeployment of capital.
Jeremy Leach, chief Executive officer at MPG, commented: “Equities are clearly overpriced based on their current yields. The inevitable increase in interest rates and creeping inflation that we expect to see on both sides of the Atlantic will only serve to weaken stock values further and the only release valve will be a substantial market correction.
“Economists and finance industry pundits continue to speculate whether a correction is on the horizon and in our opinion, it is inevitable, the only debate being whether it will manifest in a bear run or an outright stock market crash.
“Our Vita Nova Hedge Fund is fortunate enough to have a global macro investment mandate and therefore has the luxury of being able to move between asset classes that offer great potential for gains through arbitrage.”
In 2017, MPG accurately predicted the market correction in January this year, which it believes could have been a great deal worse.
Leach added: “Central banks and monetary policy committees have been trying hard to stabilise an economic position that is not sustainable and in doing so they are just prolonging the agony.”
Launched in 2014, the Vita Nova Hedge Fund aims to achieve long-term capital growth by identifying short- to mediumterm investment opportunities with inherent pricing weaknesses and the potential to improve over time. The investment management team may rely on economic forecasts and analysis in respect of interest rate trends, macroeconomic developments, global imbalances, business cycles and other broad systemic factors that may lead to arbitrage and alpha opportunities. The fund has delivered 42.11% performance over the past 12 months and has achieved annualised returns of 24.36% since its launch in 2014. It is one of the top-performing funds in its sector.
MPG is an award-winning business, having been named the 2018 Alternative Investment Firm of the Year – Europe by The European business publication, while its High Protection Fund won the Best Diversified Fund (Five Years) and Best in Insurance-Linked Investments categories in the 2018 Corporate USA Today awards.
MPG is a multi-disciplined investment house that specialises in the creation, management and administration of Cayman Islands regulated mutual funds and issuers of asset-backed securities for SMEs, financial institutions and professional investors. The wider Group currently has over $500m assets under management.