The WealthLander Diversified Alternative Fund targets a 10%+ p.a. net return over a three-year period. Our investment approach is designed to be insightful and research based with meaningful upside potential while being risk-managed and resilient through diverse conditions.
A genuine active management process and a three-stage investment approach of top-down dynamic asset and risk allocation, dynamic risk management, and bottom-up research is used to identify the best strategies for the prevailing and anticipated market conditions.
We focus on and target a reduction in the risk of large losses. We ensure genuine diversification through multiple layers of active management, and we enable more consistent return outcomes to be achieved from all market conditions. Our investment objectives are intricately linked given the crucial importance of reducing downside risks to achieve long-term compounding returns.
We use multiple complementary active strategies all professionally managed in one diversified Fund aiming to produce outstanding and consistent outcomes designed to preserve and grow investor capital. Our investment approach maximises the certainty of achieving desirable investment outcomes from income and capital gains.
Although we believe we can have great insights into investment markets and invest with great conviction, we prefer to operate as if we will be wrong on any one investment or risk factor (because sometimes we will be) and hence never excessively allocate to any one risk, position or theme. We have many opportunities to diversify given our extensive experience in research, investing and institutional relationships. Furthermore, we don’t pretend we alone will be, or are necessarily the best investment manager in every asset class or strategy. Hence, we are very willing to use and appropriately combine other outstanding strategies from other fund managers should these be assessed as being value adding to our portfolio and often we expect to access these at discounted pricing.
We don’t believe in the common dogma that “higher risk = higher return” or in tracking or aiming to beat the market return of an asset class, as this is not aligned with what investors actually need. Such philosophies commonly become overly exposed to common risk factors which exposes investors to the risk of large and permanent losses. Instead, we use our expertise to pursue and target for our investors what they actually want and need – consistent positive returns with lower drawdowns – along with an investment journey which is much more palatable for everyone including retirees, pre-retirees and the more risk averse.
Albert Einstein is reputed to have said:“Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn’t, pays it.”
WealthLander Diversified Alternative Fund Facts
Type of Fund
Absolute return, risk-controlled, diversified multi-strategy alternative Fund that is actively managed.
Type of Portfolio
A dynamically managed low correlation multi-asset multi-strategy alternative Fund.
Actively managed strategies, ETFs and direct investments.
The Fund uses a wide range of actively managed investment strategies and direct assets to deliver investors a diversified portfolio with an absolute return focus, strong risk adjusted performance, greater consistency and lower drawdowns and volatility than Australian equities, and strong correlation benefits.
A three-stage investment approach of top-down dynamic asset allocation, risk management, and bottom-up research is used to identify the best strategies for the prevailing and anticipated market conditions.
The Fund can hedge risks and market exposures via (limited loss) options, and invest in a timely fashion in many of the world’s best single strategy institutional funds, as well as make direct investments opportunistically and for hedging risk.
Target Volatility Over 3-year Periods
– Lower than equities (Possibly less than half that of the circa 15%+ annualised volatility of equities)
– Low volatility is achievable due to genuine diversification of low correlation strategies, an alpha strategies focus, downside aware portfolio construction and strong risk management
Target Net Return to Investors
10%+ per annum (and greater than reasonable prospective equity returns over a full cycle, with long term outperformance due to low drawdowns enabling superior compounding)
Fees for Flagship Fund
– Foundation fees will be 0.5% and 15% performance fee (plus GST) above cash hurdle for those investing from 1 February 2021 until 25 January 2022, for a minimum 3 year commitment
– 0.8% management fee + 20% performance fee (plus GST) above cash hurdle for investors from February 1 2022
– Preference for underlying strategies which lower overall portfolio risk and have strong prospective non-market dependent value add
– Dynamic asset allocation and risk management at portfolio level
– Overall sensitivity of portfolio to market movement monitored closely and can be kept low
– Individual strategy management and removal of strategies that demonstrate escalating risk
– Additional selective purchase of “insurance” such as option protection or protective option strategies (as required depending upon portfolio risk and prospective market risk)
Minimise loss periods to less than half that of Australian equities with quick recovery (compared to potential 30% + losses for equities), which is strongly aligned with investor preferences
The Fund is appropriate for investors who seek a risk managed absolute return alternative for their capital and is expected to be a good complement and alternative to traditional investments, such as Australian property and equities.
The Fund is potentially suitable for wholesale investors including the unadvised HNW market, SMSFs, pre-retirees and retirees, risk averse investors, wealth groups, financial planners, brokers, small institutions and foundations.
Potential Investor Benefits
- Targets actual return and risk needs.
- Consistency of performance.
- Strong downside protection.
- Credible alternative to traditional portfolios.
- Low drawdowns and strong performance.
- Potential for positive skew.
- Safer than individual strategies alone, which is attractive to allocators with agency risk (solves the “line item” problem of sporadic and inconsistent individual manager performance).
Distributor and Intermediary Benefits
- Attractive portfolio allocation and core diversified solution for “Alternatives” bucket.
- Perennially saleable due to more stable return profile and alignment with true investor objectives of high absolute returns and low drawdowns. Genuine gap for high performing alternatives.
- Once invested, investors are very sticky as product should better meets their real needs. Performance orientated fee structure demonstrates client alignment and confidence in performance.
- Little compelling or performing local competition available for core Alternatives portfolio solution.
“We take the responsibility of managing this fund very seriously. We aim to ensure we always have sufficient diversification in the portfolio, with numerous underlying and complementary sources of return. The risk of any one underlying exposure is assessed both individually and very importantly, in terms of its contribution to our portfolio as a whole. Although we keep stressing this, genuine diversification and the art of good portfolio management is very important to us (and something which is rarely offered to investors in the one Fund).”
— Founder and CIO Dr Jerome Lander