The Pengana Israel Alpha Fund is managed by Alpha LTI, a boutique Israel manager with an impressive track record since 2007. Alpha currently managed in excess of $350m in listed equities. Alpha’s partner in Australia is Pengana Capital Group, a funds management group focused on delivering distinct investment strategies that deliver superior risk-adjusted returns to investors, with a focus on capital preservation.
The fund’s investment strategy is based on comprehensive research of companies and industries in Israel. The managers follows a private-equity approach while typically investing in mature small & mid-cap listed-companies. We typically focus on:
- companies in high-growth Israeli industries that have competitive technological, product or market advantages;
- companies that are under the radar with low analyst coverage;
- companies that have best-in-class management
- companies that place a fundamental emphasis on free cash flow – enabling consistent dividend payouts;
- Private IPOs with lucrative growth potential.
The fund invests across four Core Strategies:
- Value – Valuations are paramount in this strategy and investments will generally be in high-tech or industrial companies with a distinct technological advantage. Investments will be made with a strong margin or safety when comparing price to valuation.
- Growth – This strategy provides access to the Israeli innovative edge – focusing on companies with significant growth potential.
- Special situations – While this is the smallest allocation of the four strategies, it provides the potential for the highest return through investments in corporate actions with significant upside potential.
- Hedging – The Fund purchases downside “insurance” for the portfolio through long-dated index put options. This strategy is designed to protect the portfolio in the case of a significant market correction as well as provide the opportunity to invest when equities are severely oversold.
The Israel opportunity – A global leader in innovation & Technology
- Israel ranks 2nd in the world in expenditure on research and development as a percentage of GDP.
- Israel contains the largest number of NASDAQ-listed companies in the world outside of the US and China, despite having a population of less than 9 million people.
- Largest number of start-ups per capita in the world – around 1 start-up for every 1400 people.
- 450+ Listed Equity Companies, 64 cross-listed abroad
- 9 Universities, 12 Nobel Laureates
- More than 270 multinational corporations (MNCs) have established more than 320 advanced R&D facilities throughout the country to take advantage of Israeli innovation. The list includes the likes of: Google, Apple, Facebook, Microsoft, Intel, Yahoo!, Motorola, HP, Siemens, GE, GM, IBM and Cisco.
- A number of high-profile exits in recent years – Waze (sold to Google for $13 billion), Mobileye (sold to Intel for $15.3bn), SodaStream (sold to PepsiCo for $3.4bn), etc.
- Knowledge based economy with highest concentration of PhD’s, engineers & patents filled per capita
The Pengana Alpha Israel Fund is uniquely positioned to capture the investment opportunities in some of Israel’s most attractive sectors with a locally based investment team in possession of an established reputation and deep industry ties.