SYZ Asset Management has increased the allocation to managed futures in its Altin fund of hedge funds by adding a small fund that it says is more nimble than bigger funds.
Altin now has a 1.24 per cent holding in Blackwater Capital Management’s managed futures programme to bring further diversification to the portfolio.
SYZ says managed futures, also known as commodity trading advisers or CTAs, is a strat-egy that performs well in a range of market conditions.
The company started investing in CTAs within Altin in June because the strategy was hav- ing a difficult period, which SYZ saw as a good entry point. It has since been rewarded as the strategy has performed well over the last few months
Blackwater Capital Management was chosen on the basis of an outstanding track record but SYZ says the firm is not as well known as the bigger managed futures managers such as Man AHL. The advantage of its small portfolio is greater flexibility, with potentially better performance and lower trad- ing costs.
SYZ says Blackwater identifies trend reversals earlier than some CTAs that tend to suffer for a month while they wait for signals that a trend has ended.
SYZ has also reduced Altin’s exposure to convertible bond strategies by selling out of Aristeia International but head of alternative investments José Galeano expects to reinvest in the strategy soon.
He says: “We are again bullish on convertible bonds as we have seen a massive dislocation in the convertible bond space. We are analysing it and expect convertibles to come back into the portfolio.”