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Portfolio > Alternative Investments > Hedge Funds

Altin Continues Effort to Keep Stock Price in Line with NAV

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NEW YORK (–Citing its strong returns for the first nine months of the year, Altin AG, a closed-end fund of funds listed on the London and Switzerland stock exchanges, described its current share price as unjustifiably low in relation to net asset value and the quality of its investments.

The fund, managed by the 3A-Alternative Asset Advisors division of Geneva-headquartered SYZ & Co. Group, was up 4.17% as of the end of September. But the share price did not follow with an equivalent gain and is trading at a discount of 9.8% to NAV, according to a recent statement by the company.

The stock closed at US$43 on the London Stock Exchange on Oct., well below the estimated NAV per share of US$47.71. By contrast, in November 2003 the stock was at a premium of 1.65% to NAV. Altin’s board reiterated its commitment to aligning the share price with NAV.

Shifting Strategies

Altin, launched in December 1996, is invested in 40 hedge funds, with more than 80% of assets in funds that are closed to new investors. It also includes some smaller managers trading in new strategies and geographical regions.

“This allows Altin to tilt its portfolio as required toward strategies expected to outperform,” the company stated. In the first three quarters of this year, the manager reduced exposure to convertible arbitrage and multi-strategy arbitrage and increased assets in long/short equity strategies focused on Europe, emerging markets and Japan.

Traditional funds that trade on exchanges often find their stock price diverging from their NAV because of a variety of factors. The pricing of publicly traded hedge fund firms is even more complicated because they are relatively new and there are very few of them.

The main one, London-headquartered Man Group plc, is the largest free standing hedge fund business and a component of the FTSE 100. This year it has had a turbulent time, with the stock on a sustained losing streak before partially recovering in recent months (see).

Altin’s manager, 3A, has about US$1.62 billion in alternative investments and the parent company SYZ & Co. oversees total assets of US$6.2 billion.

Contact Bob Keane with questions or comments at: [email protected].


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