Investment
service

Equity: Long / Long Short
Bottom-Up & Top-Down Approach

Fund Manager

Japanese Equity Investment Management
Koki Okahashi

(画像)ベイビュー・アセット・マネジメント株式会社 ロゴ

Investment Philosophy

The Fund regards miss-pricing as investment opportunities that are frequent with Mid/Small-cap stocks, and deploys investment process which combines "Bottom-Up Approach (Corporate Analysis)" and "Top-Down Approach (Market Analysis)" that are considered reminiscent of the two sides of a coin. With the investment strategy, which should evolve all times, the Fund intends to transform price fluctuations (risk) to excess returns (alpha).

Investment Process

For its long/short investment strategy, in the case of Japanese equity, the Fund chooses a total of 400 companies (the 300 highest cap and 100 Mid/Small-cap) as the maintenance universe from an investment universe comprising 1,200 highly liquid stocks in listed companies. The Fund then selects stocks from the maintenance universe by estimating the deviation of stock prices from the intrinsic value of the company based on a bottom-up approach (fundamentals and technical analysis), and determines portfolio exposure (net/gross) and allocation (market cap, sector, factor) based on a top-down approach. In terms of risk management, the fund focuses on ensuring liquidity, limiting volatility, and avoiding unintended bets.

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Investment Strategy

Long:
Highly Selective Japan Mid/Small-cap Equity Fund
(Inception day: September 1, 2011)

The Fund pursues mid- to long-term absolute returns. While investing in highly selective 15-20 Mid/Small-cap stocks with bottom-up research, the Fund hedges the downside risk with flexible control of cash position and equity exposure depending on the market environment by top-down research.

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In April 2017, this Fund was rewarded by financial magazine J-Money a first-place in both the One-Year Japanese Equity/Small Cap- and Five-Year Japanese Equity/Small-Cap categories of the J-Money Fund Awards 2016.

With portfolio asset size reaching the preset target, the said investment trust was in principle, closed (not being offered to new investors) at the end of March 2017.

New Active Plus Fund
(Inception day: June 2, 2017)

The Fund pursues mid- to long-term absolute returns. While investing in selective 30-50 stocks (mainly in Mid/Small-cap) with bottom-up research, the Fund hedges the downside risk with flexible control of cash position and equity exposure depending on the market environment by top-down research.

Long/Short:
New Alphex Long Short Fund
(Inception day: July 1, 2010)

The Fund pursues solid and stable absolute returns. On the long side, the Fund mainly invests in Mid/Small-cap stocks while on the short side, the Fund constructs portfolio mostly with large-cap stocks.

(イメージ)

With portfolio asset size reaching the preset target, the said investment trust was in principle, closed (not being offered to new investors) at the end of September.

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Koki Okahashi

New Alphex Long Short Fund,Highly Seleetive Japan Mid/Small-cap Equity Fund and New Active Plus Fund with original approach combining bottom-up corporate analysis and top-down market analysis

Risk needs to be capilalized and transformed to return.

Koki Okahashi joined a major trading house upon graduating from university where he was engaged in the business of accounting and tax matters in the accounting division. The situation he faced when he was sent on a business trip to Mongolia in order to perform an audit of a local company became the starting point of his career from then on. The company dominated the mobile phone business in Mongolia, and the president was a figure that had been the right hand man of a minister, however, seeing this person being extremely apprehensive of Koki Okahashi who had very little experience as a working member of society made him strongly realize that he was protected by the name of the large Japanese company. Thinking that he would rather be a working professional and get by on his own than be reliant on a company name, he moved to a venture firm providing financial consulting services in 2001. While he worked on establishing a housing loan company, the due diligence for a corporate acquisition, and financial advisory operation of PFI projects, he faced the risk of his company going bust due to the burst of the IT bubble, but he overcame the hardships as a businessman.

In 2005, when Koki Okahashi was invited to found an independent asset management company, he plunged into the world of equity investment management. Inspired by the words that what is necessary for equity investment management is not past experience but curiosity and an intuitive sense, he thought he had a chance despite his lack of investment experience. Furthermore, for him, who had strived to acquire a broad range of knowledge to generate projects at the venture firm, equity investment management as an occupation was highly appealing because it was a profession in which intellectual curiosity itself led to results, and that was why he made the career change.

Koki Okahashi later on identified many promising stocks as an analyst of the Japanese equity long/short fund, the source of excess return (alpha) for which is Mid/Small-cap equity investment, and played an active role as the driving force to keep the investment management team afloat through the Live Door shock in 2006 and the Lehman Shock in 2008. Meanwhile, many institutional investors specializing in Mid/Small-cap stocks disappeared one after the other, making Koki Okahashi one of the very few experts in this field.

Then, in July 2010, his investment management team decided to move to Bayview Asset Management in search of a stable platform. Koki Okahashi, while continuing to rack up an overwhelming track record in stock picks, began to think he wanted to manage a portfolio himself, applying his skills to analyze companies that he had developed by managing equity investments, and became the fund manager for New Alphex Long Short and Highly Selective Japan Mid/Small-cap Equity Fund since July 2014.

Koki Okahashi has a broad perspective acquired from being involved in various businesses other than finance in a large company and venture firm. With such experience as his advantage, Koki Okahashi will take on the new challenge with a strong will to identify excellent Mid/Small-cap companies upholding the Japanese economy before anyone else and to generate alpha exceeding domestic and overseas managers.

[Biography] Koki Okahashi joined Bayview Asset Management Co., Ltd., (BVAM) in July 2010 from Alphex Investments Co. when the latter’s funds under management and management team were transferred to the former. He was promoted to head the Investment Management Group II in March 2014, and then was assigned as fund manager when the Equity Investment Management Team was established. At Alphex, Koki was responsible for corporate research as an analyst for the Japanese equity long/short strategy, a position which he held since the founding of the company in 2005. Koki had started his career in 1995, joining Sumitomo Corporation where he was assigned to the accounting division to support the company’s overseas infrastructure projects and the automobile, media, and electronics businesses with accounting and tax matters. In 2001, he joined a venture company founded by a group of former employees of the Industrial Bank of Japan Ltd. (currently Mizuho Bank Ltd.) to set up Japan’s first mortgage bank, Mortgage Corporation of Japan Ltd., where he engaged in the due diligence of a Japanese company buying out a Chinese steel maker, as well as in the financial advisory operation of PFI projects of municipal governments. Koki received B.A. in business and commerce from Keio University in 1995.