Casual investors often seek to balance their portfolios by holding long positions in stocks they believe in, while hedging with short positions in stocks they consider overvalued.
However, identifying mispriced assets and predicting market shifts is a complex skill that is typically best left to professionals.
Success in long-short investing is challenging, particularly for amateurs, as it requires a comprehensive understanding of the broader macroeconomic landscape and an ability to spot emerging market patterns.
Anson Funds, a Toronto-based hedge fund specializing in long-short strategies, has long been recognized as a leader in the industry by esteemed publications like Bloomberg, Barron’s, and BarclayHedge. Chief Investment Officer Moez Kassam has spent his career honing his expertise in identifying overvalued sectors of the economy that are ripe for market corrections.
“I started trading as an undergrad in the late 90s and saw the oversaturation of poorly organized internet businesses, now known as the dot-com bubble, and my positions based on that insight set me up for a career as a fund manager.”
Today, Kassam’s fund manages CAD $3 billion of assets, relying on high-quality research and a dedicated team of analysts to uncover opportunities in both overvalued and undervalued companies and sectors.
With years of experience in investment management, Kassam has developed a sharp intuition that gives him a distinct edge in volatile markets, which see both record highs and sharp declines. In a landscape marked by events such as historic bank collapses with unpredictable consequences, the ability to understand the timing and tenor of the resulting economic impacts is crucial for navigating market turbulence.
Kassam’s fund has found success on the short side, even during one of the greatest bull markets in history – a rare feat in the industry. He possesses an uncanny ability to spot overvalued stocks, usually ones that are falsely inflated by over-enthusiastic investors or spikes in promotional media coverage.
“Finding good shorts is an art and a science,” says Kassam. “You can have the right stock identified, but precision around timing is critical.” Kassam emphasizes avoiding ‘crowded trades’ where other investors are betting on the same moves, increasing the risk of sudden volatility in either direction.
“A good fund manager is constantly analyzing correlations and monitoring exposures to ensure the portfolio can weather different market conditions,” continues Kassam.
Kassam credits his team at Anson Funds with being able to conduct deep research into company fundamentals as well as their ability to track larger trends and adjust positions as needed.
“Risk management is at the heart of everything we do,” Kassam asserts. “We’re ultimately preserving our investors’ capital and growing it when clear opportunities arise.”
For investors looking to adopt a long-short strategy, fund managers like Kassam, who bring proven track records and deep industry knowledge, offer a level of security and insights that can make all the difference in today’s volatile market.
