CABA Capital reaches milestones and sets sights on future goals

Three years ago, former investment professionals from Danske Bank decided to bring an internal strategy to external investors. Although years of QE has lowered risk premia in the bond markets, the opportunities to generate Alpha through active management are still big, says the firm’s new product specialist. Nonetheless, the company has lowered the expected return since its launch.

(left-right) Chris Sørensen, fund manager, Mette Østerbye Vejen, CEO, Christian Limdstrøm Andersen, project manager and Carsten Bach, CIO. | Photo: PR / CABA Capital

“Come June, we have now reached DKK 1 billion in AUM, and our goal is to increase that to two or even three billion kroner. Short-term, we will focus on expanding our investor base in Denmark. In the long-term, we may also target foreign investors,” says CABA Capital’s Chief Product Manager, Kristian Myrup Pedersen, to AMWatch.

The Danish company’s flagship fund is the long/short fixed income hedge fund, CABA Hedge, which targets  an absolute return averaging 5-6 percent annually by investing in Danish and Swedish mortgage securities, while hedging the interest rate risk through sales of government bonds and swap derivates. To achieve the return target, the fund uses leverage.

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