Evidence Based 
Portfolio Management

The Fund targets delivering equity market returns with significantly lower levels of volatility. The EBPM Fund combines access to some of the world’s most distinguished alternative asset managers with a global portfolio of blue chip listed equities. The combination of equities and liquid alternative investments resembles the liquid subset of the asset allocation of large US university endowments. Our marketing presentation as well as our quarterly letters can be accessed after registering an account on this website.

The EBPM Fund (ISIN AT0000A17Z11 – WKN Deutschland A1110N) is approved for distribution to private investors located in Austria and semiprofessional investors located in Germany. The Fund is tax transparent and subject to the respective withholding tax regime in Austria and Germany.

A significant share of the fund’s assets are held by its managing team and related persons. This co-investment creates both a stable asset base and a culture of strong alignment of interest between fund management and outside investors. Furthermore, the firm charges investors in the above mentioned tranche of the EBPM Fund only a small ongoing management fee and a performance fee. The performance fee only gets paid in case the Fund performance exceeds the maximum value of the Fund’s shares at any historical calender quarter end date (“high watermark”). This fee structure of the EBPM Fund provides for a sensible trade-off between the convenience of a risk balanced one product investment solution for long term asset growth and the unavoidable costs of potent risk management in a low interest rate environment.

The Fund’s portfolio is comprised of a basket of equities (the “Market Portfolio”) representing a broad cross-section of industries and geographic exposures. The weighting of individual stocks in the Market Portfolio is based on fundamental measures of size and profitability. To complement this equity portfolio, the Fund invests in a basket of alternative investment funds (the “Fund Portfolio”), as we believe that this provides exposure to specific streams of returns that cannot be captured through traditional asset classes. The Fund Portfolio is invested across the strategy spectrum, including Fundamental, Relative Value and Systematic strategies. The Fund Portfolio aims to deliver equity market returns while dampening the volatility of the overall portfolio via its low correlation to the Market Portfolio. To complement our core allocations we employ a currency and extreme volatility hedging overlay.

While we believe public equities are a prime source of excellent long term returns, the high volatility of equity share prices renders an “equity-only” portfolio sub-optimal for investors who want to invest a relatively large share of their total net worth - or a large absolute number - at one point in time. With bond yields at all-time lows, traditional means of diversification via fixed income assets will lower the expected return of long term portfolios dramatically. A well-structured portfolio of best-in-class alternative assets need not face the same headwinds that a more traditional diversifying allocation to high quality bonds currently faces. (For investors that do want to build value over time by investing a small share of their current income, we have deviced Own Austria. Please see www.ownaustria.at for details.)

The structure of the EBPM Fund, allocating about half of its assets to global equities and half of its assets to liquid alternatives, resembles the allocation relationship between those asset classes chosen by the largest US university endowments (e.g. Yale, Harvard, Stanford), where the two asset classes represented in the EBPM Fund account for 40 to 50% of total invested assets. The remaining large allocation segments (e.g. private equity, natural resources and real estate) are largely illiquid in nature and thus do not fit within the structure of a liquid open investment fund.

We enforce a low minimum investment limit because we strongly believe that everybody should be able to invest according to the benchmark liquid asset allocations employed by sophisticated institutional investors. Compliance with the rules of the Investmentfondsgesetz is ensured by pre-trade checks performed by the EBPM Fund’s administrator, Spängler IQAM Invest GmbH, an experienced independent fund manufacturer. The EBPM Fund’s assets are held in custody by Raiffeisen Bank International AG.

The official fund documents are available on the website of our administrator Spängler IQAM Invest GmbH. We would be happy to provide interested parties with more detail around our investment process, performance, and quarterly letters. For further information please contact us at admin@eb-pm.com.

The firm offers individual managed accounts for long term investors with limited liquidity constraints which opens up a wider field of alternative assets compared to the liquid alternatives included in the EBPM Fund.

The structure of the EBPM Fund in the form of an Austrian open investment fund has many advantages from an administrative point of view, including the convenience of buying and selling through standard brokerage accounts, and no or limited additional tax related expenses due to fund level withholding tax treatment. However, it requires us to follow minimum liquidity rules, which restrict the universe of liquid alternative assets that can be included in the Fund.

Given the liquidity terms of the EBPM Fund, it may make sense to build a separate account for long term pools of capital which do not require such restrictions and are sufficiently large to allow for the construction of a diversified portfolio, with the understanding that minimum allocations are typically between USD 1 and USD 10 million per alternative investment fund. Managed Account Solutions may also appeal to investors who do not want the global equities exposure which comes with the EBPM Fund or require different asset class weightings.

Our asset allocation review and advice offering provides a detailed quantitative and qualitative analysis of existing portfolios and provides a specifically tailored blue print for individual target allocations to various asset classes.

We do not employ standardized tools but rather conduct a thorough analysis of the makeup of the portfolios we are asked to analyze and translate our clients’ objectives and requirements into an actionable plan. We have very limited capacity to provide this highly bespoke service but welcome the opportunity to discuss the possibility with interested parties. We require a very high level of transparency and access to the decision makers who ask us to engage with them. Please contact Thomas Niss to discuss mandates.