ASSET MANAGEMENT WITH TRADESIGNAL.
A story of success for SKALIS Asset Management AG.

Active asset management generates alpha – at least where sustainable competence and high flexibility form the foundation of allocation control. The right finance software plays a supporting role in correct timing. It diversely supports the fund manager in his work. Learn how Tradesignal is used at SKALIS Asset Management AG and what added value is offered in generation of alpha.

 

AN EXPERIENCED TEAM WITH A SUCCESSFUL TRACK RECORD.

SKALIS Asset Management AG is an independent investment boutique with a focus on mixed funds. Experts of the fund scene know that the young company is backed by a successful team of asset managers, all of which have an outstanding track record.
They are: CIO Ingmar Przewlocka, who made a name for himself as Senior Portfolio Manager of the outstanding mixed fund MEAG EuroErtrag in the last few years. He received many awards for his outstanding performance, including a Lipper Fund Award and several € Fund Awards. Dr. Jens Bies, also an executive at MEAG for many years and later at Deka Investment, is responsible for the areas of international pensions and foreign exchange. The third portfolio manager on board is Marc Decker, also formerly from MEAG. He focuses on the segments of Corporate Bonds, Covered Bonds and Money-Market Products. Andreas Grassl is the chairman of the board, and thus mainly responsible for the sales and operating area of SKALIS Asset Management AG. He has 18 years of experience in the capital market business and was an executive for various asset managers since 2002.

 

FOCUSING ON WHAT IS IMPORTANT.

The cooperation between the fund managers at one of the largest German asset managers, tried and tested for many years, and solid financial equipment ensure that the focus in daily work is solely on management of the money provided. While a fund manager has to manage dozens of fund products when working for large providers, the entire SKALIS FUNDS team is focusing on one product – according to the motto of quality before quantity. The focus is on absolute performance and concurrent capital maintenance. This is achieved by flexible and active multi asset fund management that has earned its name. Allocation changes are adjusted to the respective market situation quickly and consistently. Short paths to decision, a dynamic organisation structure and a product with a perfect cost-benefits ratio complete the company’s profile.

 

ABB. 1: THE SKALIS FUNDS-TEAM.

From the left to the right: Dr. Jens Bies, Andreas Grassl, Marc Decker, Ingmar Przewlocka.

 

COMBINING DISCRETIONARY DECISIONS WITH QUANTITATIVE MODELS.

The investment process focuses on a discretionary decision-making concept that bundles the long-term market expertise of all specialists. The fund managers develop a clear market opinion in their “small round” using intense analysis of the macro-economic overall situation. It is at all times supplemented by further capital market analyses (e.g. sentiment or positioning data) and continually reconciled with the actual development of the respective market segments.

If market inefficiencies become evident, the fund management uses them consistently for an additional contribution to return increase and risk reduction. The allocation is mainly controlled by cost-efficient and fast utilisation of futures that act as satellites. The core portfolio itself (shares, bonds, cash) is subject to strategic adjustments only. SKALIS FUNDS also has a sophisticated risk budgeting process that is supplemented by a unique, systematic money and risk management algorithm. Item sizes can thus be perfectly adjusted to the revenue path of the fund.

 

TRADESIGNAL AS A LONG-TERM PARTNER.

Even though purely quantitative models do not play any direct role in direct portfolio control, a look at the fund managers’ screens shows that technical analysis is not a stepchild at SKALIS – quite the opposite. The fund managers use Tradesignal to observe, analyse and scan the markets relevant for each of them and to keep an eye out for interesting opportunities. The wide function range of Tradesignal makes it possible to perform many asset manager routine activities time-savingly and efficiently. The most important functions include:

  • Application of various, also internally generated, indicators and drawing tools
  • Combination of different chart types and time levels
  • Generation of course lists, portfolios
  • Use of a scanner for finding certain market situations
  • Alarm functions
  • Integration of external Excel data
  • Comfortable generation of dedicated trade strategies with pre-installed modules
  • Back test, walk forward test and optimisation of parameters
  • Use of different position value algorithms
  • Automatic generation of PowerPoint or Word presentations

 

AUTOMATIC RECOGNITION OF PROFITABLE CANDLESTICK PATTERNS.

As a multi-asset-manager, the entire fund management is aligned with quick recognition of interesting market conditions. The fund managers agree that the performanceis mainly generated by allocation control instead of title selection. Marc Decker adds: “Because of this, our approach is based on investing in the right market at the right time, instead of just sticking to one benchmark. The customer doesn’t want to know about the relative, but the absolute additional revenue from his investment in our fund.”

Using securities lists is especially suitable when particularly interesting market situations are to be identified. SKALIS uses them, among others, to find verifiably successful Candlestick patterns – of course across all asset classes. The following figure shows what pattern recognition looks like on the fund manager’s screen for a bond future. Once a pre-defined pattern occurs in the time level specified by the user, the chart will display a note that the fund manager can follow. The RSI and MACD indicators serve as an additional orientation aid.

FIGURE 2: CANDLESTICK PATTERN RECOGNITION AND COLOUR FILTER.

With the help of the „Candle Patterns“ indicator, several freely selectable Candlestick patterns are automatically marked in the chart. This way, the fund manager will receive valuable notes regarding an interesting market situation. The colour filter serves graphical structure of the individual months.

 

QUANTITATIVE TRADING STRATEGIES TO SUPPORT DISCRETIONARY SIGNALLING.

The fast and intuitive operation is a great benefit over other software solutions according to the fund managers. Tradesignal is the best solution on the market, specifically when a specific trade idea is to be reviewed for performance and robustness, says Dr. Bies. In fact, this permits generating and assessing simple trading concepts with pre-defined components and thus without any programming skills. The figure on the next page shows a comprehensive securities list applied with a trading system.

Once the pre-defined signals are activated in the respective market, the alignment will be displayed automatically – as will the correct item size if required. A review of the historic results can be called for any title in the list by mouse-click. Of course, all evaluation indices can be directly displayed in the table as well. From the asset manager’s point of view, this is a comfortable and very time-saving tool that relieves his daily work while also permitting fast reactions and thus increased performance.

FIGURE 3: SECURITIES LIST WITH TRADING SYSTEM AND TECHNICAL INDICATORS.

Tradesignal permits comfortable application of trading strategies to complete portfolios. The illustration shows a portfolio of different investment classes and the respective positioning. The entry and exit signal is the „Engulfing“ candlestick pattern. The indicator „ADX Bars“, where the chart is highlighted in colour depending on a freely selectable trend intensity are used for support.

 

PROGRAMMING, BACK TESTING AND OPTIMIZATION FROM A SINGLE SOURCE.

Thanks to the open source character of Tradesignal, all the enclosed indicators and trading strategies can be modified according to one’s own needs. Of course, integration of external data was considered as well. For example, the fund manager can use and analyse fundamental indices in the Excel format with the real-time price development data of his provider in the chart.

“Tradesignal is the best solution on the market, specifically when a specific trade idea is to be reviewed for performance and robustness.“

SKALIS FUNDS uses this option to analyse and evaluate external sentiment data. The fund managers agree that this open, fast and intuitive method is a benefit of Tradesignal over other software solutions. The historic back testing function and the integrated optimiser with its comprehensive walk-forward-tests make Tradesignal the first choice among the fund managers, who trusted in the outstanding software quality and customer consultant at their previous employers already.

 

THE FIRST FUND PRODUCT HAS A GOOD START, OTHERS ARE IN THE PIPELINE.

The high expertise and successful software support is reflected in the value development of the recently issued SKALIS Evolution Flex I. The mixed fund is mainly made up of interest-bearing securities and has a neutral share rate of 20-30 percent.

The goal is a the long-term stable value increase. As compared to the 3-month Euribor + 200 bp as common on the market, the fund has already achieved a relative plus of 2.56 % since its emission on 20 December (I-tranche, as of 21 February 2014) and thus clearly left the indicative benchmark behind.

FIGURE 4: PERFORMANCE OF THE SKALIS EVOLUTION FLEX I (SINCE EMISSION).

The first SKALIS fund had a successful start in spite of its volatile market environment. As of 21 February 2014, the mixed fund was quoted at 2.56 percent plus.

 

SUCCESSFULLY DESIGNING THE FUTURE – WITH TRADESIGNAL.

The management‘s long experience and competence, active and flexible control of allocation as a holistic concept for the customer and use of attractive market situations using the finance software Tradesignal form the perfect starting bases for a successful future.

„Tradesignal is the best software in the area of technical analysis, programming and optimising of automated trading strategies to prevail in the long term in the competition between mixed-fund provider.“

Practice confirms that use of quantity trade indications permits sensible and resource-saving support for discretionary asset managers in the daily fight for performance..

 

CONTACT

SKALIS ASSET MANAGEMENT AG
Weihenstephaner Str. 4
85716 Unterschleißheim
T: +49 (0)89. 3188804-53
F: +49 (0)89. 3188804-50
E: jens.bies@skalisfunds.com
www.skalisfunds.com