Norwegian investor Joakim Hannisdahl has gone all-in on shipping after the broader equity rout in recent weeks.
His Gersemi Shipping Fund experienced the first month of negative returns since inception last year, ending July down 3% from June, he said.
Run by Hannisdahl’s Gersemi Asset Management, the fund reached a new all-time-high mid-July, but the broad sell-down in equities towards the end of the month also impacted shipping share prices.
“Shipping equities have a statistically insignificant correlation versus the broader equity indices, but the correlation increases during broad equity sell-offs; one reason being that investors are indiscriminately seeking liquidity,” the investor explained.
The fund had a 54% net exposure before the sell-off.
“With our fundamental views across the various shipping segments more or less unchanged over the past months, we used the lower equity pricing to increase our net and gross exposure during late July,” Hannisdahl explained.
It ended the month with 61% net exposure, but has since increased this.
“The broad equity sell-off continued in early August, and we deployed our last available cash on US open on 5 August, which in hindsight marked the trough as of now,” the investor said.
“Thus, the fund currently has a 100% gross exposure and 75% net,” he added.
Hannisdahl said that although the fund is still down for the month so far in August, the increased net exposure amid rising equity pricing in recent days “has led us to recoup a large portion of the drawdown month to date”.
Gersemi has 35% invested in tankers and 30% in bulkers, with 13% each in cash and container ships, and 8% in LNG carriers.
Earlier in August, Gersemi revealed it cut tanker exposure just ahead of the plunge.
Fears of a weaker US economy wiped billions from shipping companies’ market value before a rebound.
Hannisdahl said he saw an opportunity to increase short positions in container lines and cut long positions in tanker owners.
