The Exigo Fund looks to access a combination of Arbitrage strategies in order to provide profitable and low volatility returns to investors. Its core active trading strategies, also called deterministic arbitrage, will only trade on profitable spreads that lead to highly or fully hedged market positions. In addition, the fund operates several algorithmic trading strategies, where a statistical or systematic model monitors for spreads in pairs or groups of financial instruments and takes positions in these instruments when the model predicts a statistical or systematic profit opportunity. Finally, the fund deploys event-based strategies that seek to exploit mispricings between securities whose issuers are involved in mergers, divestitures, restructurings or other corporate events.
The deterministic, statistical, systematic, and event-based strategies build up various portfolios of arbitraged positions. From a portfolio management point of view, Exigo aims to optimize these positions across different books and over the entire trading platform to create a well-balanced, market-neutral portfolio. The emphasis in this approach is on yield enhancing and hedging certain aspects of securities and positions that the fund already holds as part of its day-to-day trading operations.
The range of strategies that can be employed are:
- Deterministic Equities
- Systematic Derivatives
- Special Situations
- Asian Equity long/short
- Systematic Equities long/short
- Dual listing, single Share classes
- Corporate Events
- Corporate Actions (Equities)
- Hard Catalyst Trading
The advantages of arbitrage trading are:
- Profitable in both up and downward moving markets
- Not correlated to capital markets