Ellipsis AM continues to expand its offering in the Risk Mitigation Strategy space with the launch of its new fund: “Ellipsis Optimal Solutions – Alternative Hedging”. Available in UCITS format, the fund stands out as an innovative and truly diversifying hedging solution, designed to effectively protect against market uncertainties.
Integrated into a balanced portfolio, “Ellipsis Optimal Solutions – Alternative Hedging” provides effective diversification through the use of two complementary dynamic hedging strategies:
- A “Black Swan” hedge helps limit the maximum drawdown in the fund in the event of an extreme market shock and consists of out-of-the-money put options.
- A “Long Vol” hedge reduces the overall portfolio volatility and is implemented through a put spread allocation.
Thanks to its convex profile, “Ellipsis Optimal Solutions – Alternative Hedging” targets a performance that is negatively correlated to equity markets. The fund monetises major market declines and periods of high volatility, while optimising the cost of hedging during bull markets or periods of low volatility.
Performance[1] objective of the fund:
- +20% to +40% for a market decline of -15% to -20%
- +80% to +100% for a market decline of -40% to -60%
- 0% to -20% during periods of low volatility or rising markets
Like all open-ended funds available at Ellipsis AM, Ellipsis Optimal Solutions – Alternative Hedging is classified as article 8, SFDR[2].
Alexandre RYO, Head of Alternative & Overlay Solutions, comments: “The fund is based on the portfolio hedging mandates that have been in place for our institutional investors for over 15 years. Its asymmetrical profile aims to protect gains and optimise compound returns.
Pierre GALLICE, Head of Overlay Strategies & Portfolio Manager[3], adds: “With uncertainty still omnipresent, equity portfolios are vulnerable to future storms. The Ellipsis Optimal Solutions – Alternative Hedging fund provides an effective response, combining risk reduction and negative correlation with the market in the event of a shock.
[1] Performance net of fees (after deduction of running costs), dividends and coupons reinvested
[2] ESG: Environment / Social / Governance. SFDR: European Regulation (EU) No 2019/2088 known as Sustainable Finance Disclosure (SFDR). More information on our ESG policy (environmental, social and governance criteria): https://www.ellipsis-am.com/fra/fr/pro/esg-reglementaire.
[3] Management team at the launch of the fund on 31/01/2025, which may change during the life of the fund.
Fund risk warning:
The implemented strategy may generate negative performance during slow and continuous declines in risky assets or during periods of low volatility. The fund is exposed to model risk related to the hedging strategy implemented, which relies on a systematic management process. There is a risk that this model may not be efficient. Furthermore, the fund is exposed to volatility risk, counterparty risk, and risks associated with the use of derivative financial instruments. These factors may result in a decrease in the fund’s net asset value, which is not subject to any guarantee or protection.
IMPORTANT INFORMATION
This advertising document is for information purposes only and does not constitute investment advice on financial products. Due to its simplified nature, the information contained in this document may only be partial. It may be subjective and is subject to change without notice. All data has been established in good faith on the basis of market information. The accuracy of any information obtained from external sources cannot be guaranteed.
The investment is in units of a collective investment scheme and not in the underlying assets. UCIs do not offer a capital guarantee.
In some jurisdictions, the offering of mutual fund units may be restricted or prohibited by law. Before making any offer, it is advisable to check in which countries the UCI(s) referred to in this document are registered for marketing. The UCI may not be subscribed or held by a Non-Eligible Person or a Non-Eligible Intermediary (see the section on “Relevant subscribers” in the prospectus).
This document may not be reproduced in any form or transmitted to any person other than the person to whom it is addressed without the prior written consent of Ellipsis AM.
Additional information for Switzerland:
The domicile of the fund is France. In Switzerland, the representative is Acolin Fund Services AG, Maintower, Thurgauerstrasse 36/38, 8050 Zürich, whilst the paying agent is Banque Cantonale de Genève, 17 quai de l’Ile, CH-1204 Genève. The prospectus, the Key Investor Information Documents, the fund regulation and the articles of association, as well as the annual and semi-annual reports may be obtained free of charge from the representative.