Principles and Investment Process

Principles and Investment Process

We pursue a globally-oriented, flexible, undogmatic and themes based «top-down» investment approach with a focus on risk-adjusted returns.

We place great emphasis on risk management during both the building and day-to-day management of a portfolio. Actively managing the asset allocation (cash – bonds – equities – commodities – currencies) is a key aspect of our portfolio management approach.

Our experience has shown that a few asset allocation decisions per year represent the biggest performance drivers.

At the same time, we believe that the changes made within the portfolio weightings must be pronounced.

Once the «top-down» investment themes and weightings have been determined, the portfolio is constructed from the «bottom up» with the following investment instruments: individual securities (equities, bonds, etc.), ETFs (passive exchange traded funds) and/or specialised investment funds (for niche markets, themes or sectors.

Empirical studies have shown that the accuracy of forecasting models for the financial and capital markets is exceptionally low when it comes to predicting the mid to long-term performance of individual currencies, stock market indices, etc.

As a result, we place a much greater focus on interpreting indicators that show us the current state of the market and the direct impact (over the next 3 to 12 months) this could have on the movement of securities prices rather than developing proprietary long-term forecasting models.

In doing so, valuation data is analysed, evaluated and finally used to make investment decisions that we break down into the following two key areas («ALTRAFIN’s Investment Monitor»):

  • Fundamental indicators – «How Markets Should Be Acting»
  • Behavioral economics and market-related indicators – «How Markets Are Acting»

Report on the psychological aspects on investing as we understand it.

>> Investor Behaviour on the Capital Markets

We are fully committed to investing our clients’ capital in a responsible manner and integrate environmental, social and governance (ESG) factors, alongside commercial and financial factors, into our investment due diligence and ownership. We recognize our responsibility as an investor towards our clients, society, and the climate, not to fund unethical or unsustainable companies.

We firmly believe that this approach mitigates investment risk and has the potential to enhance investment returns in the best interest of our clients and their beneficiaries. We also try to ensure that the companies and assets we invest in respect and endeavor to benefit society and the environment.

As a signatory of the UN-backed investor initiative «Principles for Responsible Investment» (PRI) we include ESG factors in our analysis and decision-making processes and work constantly to improve ourselves in this field.