Rho Investments

Multi-strategy SIL which aims to deliver net positive return every year, regardless the behaviour of traditional assets. To achieve it, the SIF’s assets are allocated to six different strategies: Active, Relative Value, Macro Selection, Micro Selection, Special Situations and Deep Value. The strategies are focused on finding cheap assets with asymmetric profiles.  

Our approach focuses on identifying assets offering substantial optionality. In order to comply with our guidelines any investment has to comply with the three following criteria:

• Are mispriced for a defined investment horizon in statistical terms or vs our fair value models
• Exhibit an asymmetric risk-return profile.
• Have clear catalysts within the defined investment period which will result in a reversal to fair value

The following strategies will be used:

• Active trading: It uses non-systematic statistical and technical models to identify very short-term investment opportunities (intraday to one week)
• Micro: It selects outright positions in securities which are cheap by historical standards or according to our valuation models based on fundamental and industry specific analysis
• Macro: Looks to anticipate and exploit trend changes in the main asset classes (fixed-income, equity and forex) through an analysis of market and technical variables.
• Relative value: Non directional long/short or multi-leg trades in single asset, capital structure or across different asset classes that look to profit from relative mispricing opportunities
• Special situations: highly idiosyncratic event-driven opportunities looking to capitalize on M&A arbitrage, share buy backs, liability management exercises, corporate restructurings, call tenders and any other corporate events.
• Deep Value: Longer term investments in which exceptional value opportunities are linked to a relative lack of liquidity, or investments in securities that require a significant time period (a full economic cycle, market reopening, IPO, etc.) to reach the intrinsic value of the investment.

VaR metrics allow managers to estimate the maximum loss that the fund could statistically expect to suffer over a given time interval, under normal market conditions, at a given confidence level. VaR consumption shall be determined at any time by managers’ discretion based on their market view.

• A wealth of multi/asset class expertise enables the SIF to capitalize on cross-market investment opportunities and to analyze every opportunity from different points of the cap structure and/or asset types
• Strong alignment of all principals in the business with fund performance: all senior partners have the vast majority of their personal wealth and/or pensions tied up in the vehicle. Deferred compensation has to remain mandatorily invested in the vehicle.
• It adapts a time-tested and successful investment strategy to a format that enhances the risk-reward profile of the opportunity set.