Interview mit Thomas Lorenz, Fondsmanager D&R SpeedLab eQuant-Fonds
Mr. Lorenz, you are the fund manager of the D & R SpeedLab eQuant funds. An important part of these funds is the support of the SpeedLab technology. Previously, you could say you had to choose between a computerized quant fund or a discretionary fund management approach. Is there another way for the D & R SpeedLab funds to collaborate with software developers and fund managers?
Lorenz: Yes, that's what you can say. We have deliberately decided to work together with people and machines. We consider the SpeedLab technology to be the leader in this segment; it can pinpoint the strategies in which markets and the best yields in which composition. Nevertheless, the human factor is important, especially in contact with investors.
What does the cooperation look like?
Lorenz: Every day, we get the analysis results of the SpeedLab software for the equity and income strategy several times. The software also provides guidance on which futures are suitable for implementing the strategies in which markets. We then check the information on their plausibility again, and make the necessary checks. For example, whether all investment limits and corresponding quotas were met. We decide on the instruments to be dealt and give up the orders. Finally, the execution data is returned to the SpeedLab software.
We have consciously decided to work together with people and machines. "
How satisfied are you with the development of both funds? Let's first talk about the equity fund D & R SpeedLab eQuant Equity.
Lorenz: Both funds consist of a base portfolio and a futures overlay for the effective and cost-efficient management of investment quotas.
In the equity fund, European equities are in the base portfolio. This was initially unhelpful for the performance since the Fund was launched in January 2018. But you can see in the fund that the futures portfolio, which is based on the SpeedLab software, provides a positive performance contribution. This has significantly reduced volatility compared to the European equity market since the launch of the fund. Overall, the fund also outperformed the benchmark, the EuroStoxx 50.
What about the D & R SpeedLab eQuant Income bond fund?
Lorenz: The basic portfolio - including high-quality variable rate bonds - has very little impact on performance. Many of the strategies used in the futures portfolio require a certain degree of volatility in the illustrated interest rate markets. This condition has been met since the fund was launched in January 2018, but only rarely. Thus, the futures portfolio could not quite develop the expected effect. The strategy selection was nevertheless correct to the point. We are therefore very confident that this will also be reflected in performance in the future.
Is the SpeedLab technology being developed further?
Lorenz: Yes, that's a constant work. One aspect is the markets used. We are currently working with nine equity and interest rate markets each. This number is being expanded bit by bit, with no fixed schedule for this. This also applies to the use of further strategies. Currently, seven strategies are actively used, such as Trend Following, Mean Reversion or Breakout. SpeedLab is constantly testing other strategies in other portfolios. If they prove successful, they can also be used in the D & R SpeedLab eQuant funds.
What do investors say about the combination of man and machine?
Lorenz: I have the impression that this is a good thing. Our house found in a survey this year that digital solutions are sometimes viewed critically by institutional investors because they lack the necessary explanations of how they work. Here we offer a solution at Donner & Reuschel. We are always in contact with interested parties and are happy to help explain the D & R SpeedLab eQuant funds.