Model Spotlight: Emancipation Long/Short Equity

New York (HedgeCo.Net) The Emancipation Long/Short Equity Model has been the HedgeCoVest top-performing single-strategy model on a year to date basis since the end of March. The model is managed by Emancipation Management, LLC, an SEC registered New York based investment manager.

The model is focused on the tech sector and the primary analysis technique that is used is fundamental analysis, with technical analysis and sentiment analysis also playing a role in the selection process. In an interview with HedgeCoVest, portfolio manager Charlie Frumberg stated that the goal was to be “market agnostic”. In other words, they aren’t focused on bullish or bearish investments per se, they are interested in investing on either side of the market in order to produce positive returns.

Through the close on July 1, the model was up 11.43% from the beginning of the year. The standard deviation is 16.71% which is in the middle of the pack compared to the other models on the platform. The maximum drawdown occurred in the 2008-2009 bear market. The correlation of 0.26 is extremely low and among the lowest from the single-strategy models.

The allocations are currently divided among 44 different positions which is a moderate number of positions based on the other models on the platform. The breakdown of the allocations definitely reflects the tech-focus mentioned previously with the long book having the heaviest allocations at present to the telecom, internet and software sectors.

While the model focuses on the tech sector, it is not restricted to only tech-oriented investments. With that being said, the Emancipation Long/Short Equity model is a general model that can be incorporated to almost any type of investors portfolio. Because of its long/short structure, bullish investors looking for some protection should the market go through a correction could benefit from the model. If an investor is skeptical regarding the overall market, but doesn’t want a short-only model, the Emancipation model could fit their needs as well.

Rick Pendergraft
Research Analyst
HedgeCoVest

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