Crescit offers a tailored investment strategy that utilizes options and derivatives in global financial markets. Crescit differs from traditional investments and uses the following building blocks in the portfolio:

Asset types and use of derivatives

The fund actively allocates its risk between different asset classes depending on the opportunities that the management sees ahead. Exposure is taken primarily at index level or in diversified instruments to avoid idiosyncratic risks at the company level. Unlike traditional funds, Crescit never owns any common stocks but instead uses derivatives in its management. By combining derivatives, the fund can use several different strategies simultaneously without increasing the risk through leverage. The fund derives its return largely from traditional asset classes but uses derivatives to steer and control it.

Stock index derivatives

Stock market exposure through derivatives

Crescit's basic exposure is an asymmetric exposure to a rising stock market. By combining options and derivatives, the fund creates a convex outcome space where the potential upside is significantly greater than the downside risk. Over time, Crescit takes advantage of both the fact that the stock market is rising in the long term but also that the movement can be volatile.

Portfolio protection

Crescit utilizes options to provide protection against falling markets and to reduce the fund's risks. In addition to the core strategy, we employ a number of separate options strategies to enhance the fund's risk-adjusted returns and take advantage of the pricing of expected volatility.

Interest rate management

Crescit's largest allocation is to fixed income assets. We primarily use bonds from issuers with good credit ratings and short maturity dates. We ensure good liquidity in the often illiquid Nordic credit market through a high degree of diversification and short maturities.

The fund strives to deliver a good risk-adjusted return that, over an investment cycle, lies between a credit fund and an equity fund with a significantly lower downside.

Correlation and Volatility

Crescit normally has a fairly high correlation with risky assets but deviates from time to time as returns are also dependent on the pricing of volatility and how risks are allocated. The goal is to have limited exposure to sharp declines, which reduces correlation and creates a stable return profile over time.

Risks and Limitations

Crescit is an alternative investment. In times of strong stock market ups and downs, the fund will deviate from the performance of risky assets. The fund's objective is to provide a stable and high risk-adjusted return over time with limited volatility. In particular, the fund may deviate from traditional asset classes in times of volatile volatility.

In summary, Crescit offers tailored exposure to volatility, bonds, and equity index derivatives for investors seeking a complement to their other traditional asset allocations that is not dependent on the manager choosing the right stocks or utilizing high leverage.