Alfa Axiom Fund is a specialty fund according to the Investment Funds Act (2004:46). The Fund is a quantitative trend following hedge fund focused on trading financial future contracts traded on the global futures exchanges. The underlying assets are commodities, equity indices, interest rate instruments, and currencies. The Fund is denominated in SEK.
The Fund’s objective is to achieve sustained high risk-adjusted returns. In addition, the Fund exhibits a low correlation with equity and bond markets. This means that the Fund value can increase or decrease regardless of the movements on the stock and bond markets.
The Fund’s average annual return target is 15 to 20 percent. It seeks a level of risk at about 13 percent, as measured by annual standard deviation of monthly price movements. The Fund is, therefore, considered to be a ‘medium risk fund’. The primary aim is that the average yield level will be achieved over a period of approximately 3 years or longer.
The Fund’s assets may be invested in transferable securities, money market instruments, mutual funds, derivatives and on accounts of credit institutions. The Fund’s assets may be invested in such derivative instruments, where the underlying asset consists of commodities, securities, money market instruments, financial indices, interest rates, exchange rates and/or foreign currencies. The Fund, however, is not allowed to take derivative positions to physical delivery.
The investment decisions in various markets are based on quantitative decision models. Accordingly, all investments are made purely on objective grounds. Decision models aim to analyze different market price movements. Risk management, as the limitation of maximum loss for each investment, is an important part of the decision-making models construct. The objective of the decision-making models is to create as smooth return as possible.