ORIGO QUEST differs from both other small cap funds and hedgefunds in several ways. The investment model is based on in-depth analysis and committed ownership in combination with an absolute return focus. The fund structure is designed to support the strategy and management work.
 
Small Cap Equity L/S long bias
QUEST is an alternative equity fund under the AIF regulations with a more flexible investment mandate than ordinary equity funds. This means that QUEST can invest in equities, interest-bearing instruments and derivatives, as well as glossy shares. Especially the possibility of having both long and short (short selling) equity positions means that the fund has greater opportunities to deliver positive returns and optimize the risk profile more or less regardless of the market trend. The funds gross and net exposure has historically been  ~140% and 49%. 

QUEST primary focus is Nordic small- and mid caps, a market segment that we have +40 years of combined experience of in the team. Small caps offers better growth opportunities and often lack reserach coverage from sell-side and media. There are some 1500 co´s in our investment universe so the diversification opportunities are great. The combination of growth opportunities and a non-efficient market creates fantastic stock-picking opportunities for a research-driven small cap boutique as Origo. 
 
Unique strategy and investment style
The Fund's strategy is based on early identification of value drivers in Nordic small cap companies. In-depth analysis, close contact with the companies and a long-term focus are important ingredients in the investment teams work. We like to invest in companies with strong market positions and long-term sustinabale growth opportunities, but which have short-term problems and therefore often greater return potential. In the same way, though on the contrary, the fund short-sells companies that in our opinion are overestimated and who have more long-term challenges or an unattractive risk profile.

Sustainable investments
The world faces many challenges, not least demographic and environmental. Both society and business are affected by these challenges and must relate to them. For some companies, the challenges can also be an opportunity. We avoid or exclude companies and industries that do not meet our requirements, both from a sustainability perspective and a risk perspective. We prefer investments in companies that show long-term sustainable growth and that in many cases also offer solutions to global challenges.
 
Strong track-record
QUEST has a clear target for the long run; to deliver equity-like returns at bond-like risk level. A sub-target is also that Quest should be in the top quartile of comparable funds. Since its inception in 2013 the fund has gained 140% or 9,3% per year. (220131-230131). The amount of risk that has been taken amounts to 0,4 in terms of beta, leading to a risk-adjusted return (treynor-ratio) clearly above both the Swedish OMX-index and the small cap index.  
 
Diversification
Good diversification is achieved when creating an investment portfolio where assets have low or limited co-variation with each other. The portfolio is concentrated and is often dominated by companies with attractive long-term fundamentals, but with short-term issues. Quite often the company lacks sell-side coverage and has limited institutioneal ownership. All in all, the strategy results in that the fund's return primarily comes from the specific stock positions and not from the general market trend. The relatively low correlation with the stock market index over time, compared to ordinary equity funds, means that the fund is very well suited for diversfication in a larger investment portfolio.

A performance related fee structure
Quest charges a fixed management fee of 1.25–1.35% and a variable performance-based fee if the fund's performance exceeds the return threshold. 80% of any excess return is due to the investor and 20% to the manager. Unlike many other alternative funds that have a threshold rate of 0-2%, QUEST  has a threshold rate of 90 days SSVX + 5%. The fee model is thus linked to a clear value creation.
 
High Water Mark
QUEST applies the so-called High Water Mark principles. If the fund has a weakness, the fund manager must recover the lost return and the calculated threshold interest rate during the period before variable fees can be paid. This ensures that no investor pays variable fees unless it has had a clearly positive development on its investment.
 
Transparency
Alternative funds can sometimes be complex and difficult to judge from the outside. There are plenty of secret managers too, which doesn't make things any easier. We have chosen another model and have transparency as a guiding star. We continuously update our investors about the fund and its investments through monthly letters, presentations and individual meetings.