The implementation of the "VAA Value Strategie PLUS strategy" (short "VSP strategy") is based on 2 investmentsegments:
The writing of options: 50% of the strategy consists of selling PUT-Options (S&P500, Eurostoxx 50, FTSE 100), the so called "writing of option". These sales generate regular premium income (as in the insurance business).
Equities: 50% of the strategy consists in investing in value stocks. These generates gains and dividends.
Both investmentsegments are always secured against high losses.
The writing of options - Selling of PUT-Options
What institutional Investors such as banks, insurance companies and private pension funds have always done within their portfoliomanagement, remains quite unkonwn with the normal private investor. But the writing of options meets two important aspects: the compromise between good investment performance and at the same time a real protection against capitalloss. The famous and legendary stock exchange Master André Kostolany said it very clear: "The amounts that the buyers of options regularly loose is going into the pocket of those who write the options, who are not by coincidence the same than the big banks and insurance companies". In opposition to the Option-buyers, where the investors loose their money in more than 70% of the cases, the writing of option is a possibility to earn returns very regularly.
Equity/stocks - Value investing
The value investing has different facets. The most important though is the search for stocks that are traded well below their »real value« and have a clear »margin of safety«. A special attention is given by the Asset Manager of the strategy to companies that have a good and understandable sustainable business model, that is supervised and run by capable and integrated company managers.
Tha Value-Investing-Legends Benjamin Graham, Warren Buffett and of course André Kostolany have achieved excellent results with their classical Value-Investing.
Opportunities and Risks
Beside the systematic implementation of the so called "writing of options" strategy, this strategy invests in "cheap" quality stocks, that allows over a long term an over-average performance potential. Both investment segments are systematically protected against high losses.
Opportunities – Gains through the revenue from premiums, dividends and rising share prices.
Risks – Losses are limited by the systematical hedging of the portfolio.
The Basis of the Strategy
Investment into 2 Investmentsegments
Divided into two segments. Should segment a.) show some weaknesses then this can be made up for by segment b.) and vice versa.
Both Investmentsegments are always hedged against high losses.
Investments are made into liquid markets only. The "writing of option" segment is using the S&P500, Eurostoxx 50 and FTSE 100 Indexes only. The Value investments are only made into stocks from quoted companies and only if their business model is understandable and offers high long-term performance potential. The quality and integrity of the management team of the stocks we invest into is of the highest importance.
Anti-cyclic and patience
Opportunities arising from crisis or bad news are used for anti-cyclic bying and we shall wait with patience for the stocks to recover.
The VSP Strategy offers both high protection as well as a Top-Performance with a weekly liquitity.
The VSP Strategy was able since 2008 to perform around ca. +6,00 % p.a. net after costs. Please find the monthly fund reporting of the VSP Strategy here.
From € 1.000 became since 2008:
Compared directly to the Big Names of the market (Benchmark*) the VSP Strategy - although hedged permanently - is beating the Benchmark,
*Benchmark (same weighting) consists of: Ethna Aktiv, Flossbach Global Opportunity, Carmignac Patr., Nordea Stable Return, Sauren Absolute Return, Loys L/S
VSP compared to DAX and Co.
The VSP Strategy is managed by ICM InvestmentBank AG from Berlin. ICM InvestmentBank AG was created in 1999 as a result of a HypoVereinsbank-Group buyout and has around € 500 Millions under management.
VAA Value Asset Advisory from Munich acts as the fund advisor. The VAA–Value–Team consists of Felix Schleicher (ex Managing Director of the FIDUKA Asset Management Ltd., co-founded by André Kostolany) and Markus Walder. Both work as a team since 2001 and stand for the value-based investment style for more than 15 years. The VAA manage around € 70 millions.
Printed documentation of the VSP Strategy is available upon request here.
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