Accelerate Private Equity Alpha Fund

About the Fund

The Accelerate Private Equity Alpha Fund (TSX: ALFA) is designed to provide investors with private equity-like investment returns through a diversified long-short portfolio of equity and derivative securities.

Investment Objectives

  • Replicate private equity returns
  • Target 12% – 18% annualized returns
  • Hold leveraged long positions
  • Hedge leveraged portion of portfolio
  • Provide uncorrelated returns
QUICK FACTS

Type:
Long-short equity

Structure:
Alternative ETF

Date Started:
May 10, 2019

Management Fee:
0.00%

Performance Fee:
15% of outperformance over high water mark

Investment Manager:
Accelerate Financial Technologies Inc.

Distribution Frequency:
None

Exchange:
TSX

Currency:
CAD

Risk Rating:
Medium-High

Reference Portfolio Performance

Accelerate Private Equity Alpha Fund

Investment Process

ALFA utilizes a two-step systematic, proprietary multi-factor model to sort and rank all liquid North American stocks based on typical private equity leveraged buyout characteristics. First, ALFA filters all liquid North American stocks based on valuation, liquidity and size, and chooses a basket of top-decile, small and mid-cap value stocks. Then, ALFA ranks these top-decile value stocks based on four principle factors:
  1. Debt Paydown
  2. Return on Capital
  3. Gross Profit/Assets
  4. Change in Total Assets

The Fund goes long a leveraged portfolio of the highest expected return stocks selected from the multi-factor model while hedging the leveraged portion of the long portfolio by going short a broad U.S. equities index. The portfolio is balanced on a monthly basis.

Performance as of 2020-May-29

1 Month3 MonthsYTD1 Year3 YearsSince Inception
ALFA0.5%-1.6%-22.6%-16.3%n/a-32.0%

Fund Characteristics as of 2020-May-29

LongShort
Number of Securities391
Average Market Cap ($mm)$1,396$55,111
Beta1.31.0
EBITDA/EV22.3%7.3%
Gross Profits/Assets8.1%6.3%
Change in Debt-4.3%3.0%
Return on Capital10.7%17.9%
Change in Assets0.1%2.5%

Sector Weightings as of 2020-May-29

LongShort
Communication Services9.5%-3.1%
Consumer Discretionary17.6%-2.9%
Consumer Staples10.4%-2.0%
Energy12.3%-0.8%
Financials16.3%-2.9%
Health Care6.8%-4.3%
Industrials19.3%-2.2%
Information Technology14.9%-7.3%
Materials17.9%-0.7%
Real Estate0.0%-0.8%
Utilities3.1%-0.9%
Equity Exposure128.0%-27.9%

Fund Holdings as of 2020-May-29

LongWeight
MasterCraft Boat Holdings Inc4.6%
Dundee Precious Metals Inc4.1%
Malibu Boats Inc4.1%
Triumph Group Inc4.1%
Orion Engineered Carbons SA3.9%
Edgewell Personal Care Co3.8%
Walker & Dunlop Inc3.8%
MEDNAX Inc3.8%
Brightsphere Investment Group3.6%
Torex Gold Resources Inc3.6%
B2Gold Corp3.5%
Perion Network Ltd3.5%
Ingredion Inc3.5%
Scholastic Corp3.2%
Quanex Building Products Corp3.2%
Geopark Ltd3.2%
W&T Offshore Inc3.2%
Amkor Technology Inc3.2%
LCNB Corp3.2%
HNI Corp3.2%
Lifevantage Corp3.1%
Xerox Holdings Corp3.1%
BorgWarner Inc3.1%
Photronics Inc3.1%
Recro Pharma Inc3.1%
Superior Plus Corp3.1%
Teekay Tankers Ltd3.1%
Miller Industries Inc3.0%
GrafTech International Ltd3.0%
TriCo Bancshares2.9%
Autoliv Inc2.9%
Verso Corp2.9%
Lands End Inc2.9%
Deluxe Corp2.9%
Waddell & Reed Financial Inc2.8%
DHT Holdings Inc2.8%
Hollysys Automation Technologi2.8%
Diebold Nixdorf Inc2.7%
National CineMedia Inc2.7%

 

Short Security NameWeight
S&P 500 Index Futures-27.8%
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