Background and history
Founded in 2008 to invest efficiently in liquid securities with a transparent approach. The company oversees more than 270 million euros in the Simplify 02 fund and other platforms. The team is made up of experienced senior professionals with different backgrounds. The management team and style have evolved over the years adapting to market conditions. The asset allocation of the fund is designed to protect capital and maximize the return on specific opportunities as soon as they arise. Here we summarize the main stages of the long track record. During the life of the fund, the return exceeded 5% per annum in EUR with a volatility of less than 1.25% (a Sharpe ratio always higher than 1 and, in many years, in a range between 2 and 3) .
Over the years, we developed several strategies and competencies either hiring or forming resources internally. Thanks to this approach, we now have access to what we believe is the most appropriate strategy depending on the various exogenous factors vis a vis the economic cycle. We maintain a vast database of models, algorithm and financials papers that proved their efficacity over the years.
1) February 2009 - June 2015. We anticipated the effects of the GFC in 2007 while, in August, we were discussing the start of the fund. In the meantime, we advised our investors to stay cash until February 2009. When the result of the banking bailouts became evident, we started investing in the newly created fund, Simplify 02. As the financial crisis moved to Europe, we capitalized on previous experience and kept the portfolio very liquid and invested prudently until mid-2012 + 39.7%
2) June 2015 - August 2016. In 2016 we achieved one of the best annual performances ever. We observed that certain factors in the energy market was positioned for a rally and decided to rebalance the portfolio accordingly. +15.4%
3) August 2016 - January 2019. Since 2012 adjusted earnings of S&P 500 companies begun diverging from the valuations of the equity market. We concluded that a 1999 scenario looked increasingly likely. We have underestimated the fiscal reform promised by the new US administration and have been very conservative in anticipation of clear opportunities. We have perhaps underestimated the political factors and the orientation of central banks. -2.7%
4) January 2019 - December 2019. Market neutral approach with equity component of the portfolio reduced to a minimum. The FED "mistake" took most investors off guard and turned against risk-taking spoiling the result of the year. Subsequently, the disjunction between financial markets and adjusted learning became more evident. We opted for market-neutral strategies until we felt more comfortable with the market condition -8.8%
5) December 2019 - June 2020. Markets at all-time highs have finally been in a euphoric phase. We positioned ourselves accordingly and, in line with our mandate, we actively managed the risk to minimize drowdowns and take advantage of specific ideas typical of times of crisis. YTD + 2%