Jupiter Asset Management has launched its GEARx strategy, a higher leveraged version of the $3.8bn Jupiter Merian Global Equity Absolute Return (GEAR) strategy.
Aimed at sophisticated professional investors, including in in Singapore, Hong Kong, Taiwan, Australia and Thailand, this is the latest development under chief executive Matthew Beesley, who has been re-shaping the London-listed asset manager to offer new investment capabilities to a wider set of clients, according to a statement by the UK asset manager.
GEARx adopts the same investment process as the original GEAR strategy, which has been running since 2009. Each day, the team’s proprietary computer-based model assesses 40 million data points across a universe of 7,000 investible companies against a range of proprietary stock selection strategies.
Both strategies are managed by Amadeo Alentorn (pictured) and the seven-strong Jupiter systematic equities team, which runs $14.5bn in total AUM, according to firm.
However, GEARx incorporates higher gearing and volatility constraints than GEAR to appeal to clients that invest in hedge funds.
GEARx has typical gross leverage of up to four times, compared with two times for GEAR.At 12%, GEARx has twice the targeted maximum annualised volatility limit of GEAR, for an expected return of cash + 10%, versus an expected return of cash +5% for GEAR, Alentorn and his team calculate.
Alentorn said:“We believe systematic investing has an advantage because it is dispassionate and not prone to human bias. Indeed, our process seeks to exploit other investors’ psychological and behavioural biases. Markets are inefficient, and we seek to exploit the inefficiencies we find.”
Jupiter’s systematic equities team employs an equity market neutral investment approach to GEAR and GEARx, which results in returns uncorrelated with broader equity markets, he added.
“This lack of correlation [with the MSCI World index} has made the strategy a powerful diversifier, offering investors meaningful protection and return during periods when traditional assets have come under pressure,” said Jupiter
