A Message From The Fund Manager,
Adrian Courtenay

Dear Investor,

Welcome to GA-Courtenay Special Situations Fund. We are a deep-dive research led, global equity strategy targeting excellence in investment with modest-to-low correlation to the market at large. Our investment approach allocates to high quality equity investment opportunities and selected merger arbitrages.

Our strategy advantage

The core contention of our approach is that the optimal path is best achieved by a full review of the opportunities provided by the stock market (including both equity investment opportunities and merger arbitrage opportunities), as well as a path targeting modest de-correlation from the market (and as such possessing the prospect of accretion of returns, by, during periods of market distress, being able to take advantage of forced selling by others).

However, whilst traditional hedge funds achieve de-correlation by market hedging, this introduces a great disadvantage – economic inefficiency. The stock market, as a dividend distributing construct whose earnings power over time also rises with inflation, is expensive to hedge over the long term. Other approaches to hedging, namely a stock specific short book, by its low forecast accuracy, can introduce comparable costs.

By contrast, with our approach, through our merger arbitrage allocations at up to one third of the fund’s capital, we can achieve modest de-correlation yet without handicapping the efficiency of the fund. The fund does not hedge the overall market nor short individual stocks. Naturally, our lack of hedge also means that we must limit gearing – our tolerance for leverage is only against the fund’s merger arbitrage holdings, and strictly limited to no more than 20% of the fund’s total assets.

Our commitment to excellence

Since its inception in 2019, the fund has delivered net annual returns within the first decile of all UCITS hedge funds. However, our early years also included learnings which informed the fund’s strategy optimisations, and today these optimisations also lead to our great confidence that our best days are ahead.

Our commitment is to excellence on behalf of our unitholders: across the board cash generative, high quality holdings, with straightforward business models, and where possible the identification of such holdings at highly attractive pricing, driving performance at the fund level. However, and within this context, the fund does not tolerate the types of allocation that attempt to enhance returns by prioritising low valuation ahead of business quality or arbitrage robustness, which, if embraced, can lead to uncertain outcomes or instances of permanent impairment of capital.

Please do review the content of our website, including our white papers, which provide detailed analysis relating to selected stock specific fund holdings. The fund’s shareholder letters and quarterly webinars are also available on this website, which provide regular updates to fund unitholders.

We look forward to hearing from you, and we hope to provide an excellent long-term home for your trusted fund allocation,

Warm regards,

Adrian Courtenay