In this article, we’ll inquire into three Alquity funds’ features, fees and performance to help you weigh if they’re worthy investments.
Asset management firm Alquity’s investment strategies are made to seek excellent returns on a worldwide scale using portfolios that are in sync with long-term thematic trends.
The funds managed by Alquity are designed with social responsibility in mind, with a focus on outperformance and the promotion of long-term growth. Fund managers are actively encouraged to participate and to freely share their in-depth analyses as part of this company-wide culture.
The Alquity SICAV UCITS Fund is a recognized collective investment plan, and each of the funds below is a separate sub-fund of that fund.
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Alquity Investments
How Alquity Funds Work
All Alquity funds adhere to the daily dealing UCITS V regulations and operate as long-only equity funds. The fund managers’ primary objective is to increase returns by locating and funding the most attractive prospects in each location.
Furthermore, all of their funds are overseen using a uniform, high-conviction, fundamentally-driven methodology. Finding companies with solid structural growth stories that can deliver high returns to shareholders over the next three to five years is the focus of this strategy.
Targets
The primary goal of the Alquity Global Impact Fund is to generate stable returns over the long term. Preference is given to companies that lead in environmental, social, and governance (ESG) practices and help achieve the UN Sustainable Development Goals.
Tobacco, alcoholic beverages, soft drinks, adult entertainment, gambling, civilian firearms or weapons, fossil fuels, non-renewable utilities, and resource-intensive construction materials are all excluded from the Fund’s investment strategy.
Rather than simply tracking the performance of the broad index, the Fund uses unique data analytics to build a portfolio that shows markedly better results in accordance with the UN SDGs. It favors stocks with strong equity and country-level macroeconomic characteristics.
Therefore, the fund’s objective is to achieve more deliberate and quantifiable UN SDG goals while earning returns that are in line with its benchmark and a risk profile that is similar to that of the benchmark.
Ten percent of the company’s earnings are given to the Transforming Lives project. These efforts are in line with the company’s larger social and environmental goals since they aim to provide people with less access to economic opportunities with stable means of support.
Alquity Global Impact Fund
The largest portion of the fund’s portfolio is invested in Microsoft and Nvidia, which isn’t surprising given its allocation of investments in the tech sector is also the largest at 32% of the entire basket. Geographically, most investments are targeted in the US at almost 60%.
The Alquity Global Impact Fund comprises a diversified portfolio of 122 individual assets and currently manages assets totaling US$10.1 million.
The Luxembourg-domiciled Fund requires US$2,000 initial investment to participate.
In terms of management fees, an annual charge of 1.60% is applicable. Moreover, a performance fee of 15% is assessed, subject to a hurdle rate and a high watermark mechanism, ensuring that performance fees are only levied when specific performance thresholds are met.
Portfolio Performance
In the last six months through March, the Alquity Global Impact Fund achieved a substantial return of 18.39% and has posted a gain of 6.82% from January to March. However, when considering a broader one-year horizon, the Fund recorded a loss of 8.70%.
Since its inception on January 29, 2021, the fund’s overall performance indicates a loss of 5.64%.
Alquity Future World Fund
The Alquity Future World Fund was launched on May 6, 2014, and it now oversees $43.4 million in assets. A total of 67 different securities or assets are held within the fund. A minimum commitment of $2,000 is asked from any potential backers.
The yearly charge for fund management is 1.90%, and a 20% performance fee is imposed, based on meeting certain performance criteria such as a hurdle rate and a high watermark.
Fund’s Track Record
The Alquity Future World Fund logged a gain of 1.4% for the three months ended March and 11.5% during the preceding six months leading up to March. The fund lost 14.3% in the 12-month period ended March.
Since its inception, the Fund has recorded a loss of 21.6%. On March 31, the fund’s turnover rate was 19.7%, reflecting its average yearly holdings turnover since inception.
This fund’s investment allocation is largely concentrated in the consumer discretionary sector and in China.
The top holdings include TSMC and Tencent Holdings. In terms of capitalization, small cap stocks comprise the largest of the portfolio at 46%.
Alquity Indian SC Fund
Created on April 30, 2014, the Alquity Indian SC Fund now holds 35 assets worth $22.2 million. A minimum investment of $2,000 is requested from potential investors.
The fund has a 1.60% annual management charge, plus a 15% performance fee that is levied based on meeting certain performance benchmarks.
Fund Profitability
The Alquity Indian SC Fund lost 3.9% and 3.7%, respectively, in the three- and six-month periods ended March. Within 12 months, it fell 9.8% too.
Considering the Fund’s entire history, it has shown impressive growth with an aggregate positive return of 79.4%. Moreover, as of March 31, the average turnover rate of the Fund stood at 13%.
Majority of the Fund’s investments are placed in the financials sector in India, with ICICI Bank as its top holding shares. In terms of capitalization, small cap stocks comprise the largest of the portfolio at 46.9%.
Due to the Fund’s exposure to emerging market equities, it is possible that investors will not recoup their original capital investment.
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Adam is an internationally recognised author on financial matters with over 830million answer views on Quora, a widely sold book on Amazon, and a contributor on Forbes.
