Within DALIS, students run a mock global macro hedge fund, known as The Maritime Fund. The Maritime Fund consistently performs alpha above the S&P/TSX. The fund achieves strong returns obtained by employing a multi-strategy approach to global markets while using appropriate leverage. A diversified set of sub-funds are employed to achieve these goals while maintaining a strong risk management framework.
The Maritime Fund
Our Investment Philosophy
The Maritime Fund aims to generate outsized returns over an 8-month trading period by embodying multi-pronged long/short investment strategies to allocated asset classes. The fund is comprised of a diversified set of sub portfolios including Financials, Consumer, and Technology, Energy, Industrials, and Real Estate, Commodities, and Global Macro. Each group applies its expertise to seek unidentified opportunities, exploit market inefficiencies and hedge market risk in order to generate high risk adjusted returns.
Each group utilizes fundamental analysis to identify securities that are currently priced far below their intrinsic value. We apply low risk strategies to undervalued securities to create a hedge while Portfolio Managers utilize high risk derivative strategies to capitalize on volatility. Investments within equity groups are largely focused on small to mid-cap securities that typically present market inefficiencies. Our sector divided equity groups are designed to serve as a flexible, comprehensive asset solution allowing us to benefit from industry opportunities while limiting downside risk throughout today's evolving and turbulent market. Our commodities portfolio provides exposure to the extremely large commodities market through trading derivatives on raw materials and other fungible assets. The Global Macro portfolio invests in a wide range of securities including bonds, futures, options, and currencies in order to provide a return based on the world’s macro-outlook. The Macro portfolio also acts as an indirect hedge for the Maritime Fund against unprecedented economic events.
As a result of the short-term approach, the Maritime Fund is exposed to great amounts of risk and must be extensively monitored. To mitigate the risk, we have structured the portfolio to maximize diversification within asset classes and thus reducing the Maritime Funds overall risk. Prior to entering any position, extensive analysis is performed to create a structured investment thesis outlining entry/exit points, investment catalysts, and alternative opportunities, which ensures the quality and soundness of each executed trade. Each Portfolio Manager is responsible for micro hedging their individual positions to reduce the funds risk exposure.
The Maritime Fund has an investment process with a robust management approach that allows us to minimize risk while continue to benefit in volatile market conditions. Our framework combines multiple sources of quantitative and qualitative analysis to establish asset allocation, monitor risks, and to meet our goal of generating substantial returns.