Who are we?
Hivelr Quantum Alpha is an investment management company trading in global financial markets utilizing quantitative and qualitative methods to construct portfolios, generate alpha, and manage risk and return.
Assets Under Management (AUM)
Assets Under Management (AUM) in USD
How much does it grow?
How do we invest?
Harnessing the Power of an Efficient Market and Compounding Interest.
Growth of US$1,000 from January 1926 to December 2020.
Our investment approach is based on the Power of an Efficient Market and Compounding Interest in the long term.
The financial markets have rewarded long-term investors in the last century. In December 2020, a US$1,000 investment in 1926 is worth $74 million in US Micro Cap Stocks, $11 million in US Large Cap Stocks, and $15,139 in cash.
During that period, there were 16 Recessions, the Great Depression of 1929, 2 World Wars, Atomic Nuclear Bombings of Hiroshima and Nagasaki in 1945, 1950 Korean War, 1955 Vietnam War, 1947 - 1990 Cold War, 1970 Oil Crisis, 1990 Gulf War, 9/11, 2003 Iraq War, the Great Financial Crisis of 2008, and COVID-19 Pandemic.
Most skeptics preached that the world was going to end at some point and bet against the market. However, the economy continues to grow, fueled by technological breakthroughs. The stock market gained more than 1,099,900% in the last 94 years.
Our investment portfolios are designed, constructed, and managed to harness the long term POWER of an EFFICIENT MARKET and COMPOUNDING INTEREST. Rather than relying on complicated forecasts and predictions to outperform others, we believe in an Efficient Market where the security prices are set by a collective knowledge of millions of buyers and sellers.
Letting the Efficient Market do its job to drive information into prices frees us to take a more systematic and less subjective approach to investing. It also allows us to design, construct, and manage portfolios efficiently and better serve our investors.
In addition, rather than engaging in High-Frequency Trading to gain short-term profits, we prefer to buy, hold, reinvest dividends, and rebalance securities in our portfolios to exploit the power of long-term compounding interest.
Long-Term Investing is the foundation of our investment approach that we can implement consistently to produce exceptional returns in the long run, even in challenging market conditions.
Applying Academic Research in Quantitative Finance and Nobel Prize-Winning Financial Economic Theories.
Our investment approach is based on Quantitative Data; not influenced by short-term volatility, hype, and speculations.
Data-Driven Investing is the backbone of our RISK MANAGEMENT. It is used to eliminate human emotional factors in making investment decisions (data vs. opinion). Short-term volatility, hype, and speculations drive the traditional investment market, which causes the investors to buy-high/sell-low and incur a significant investment loss. The hype about bitcoin, dog-themed cryptocurrency, and meme stocks - e.g., GME, AMC - makes Data-Driven Investing more crucial than before.
Risk management is the cornerstone of our investment approach. At Hivelr, we utilize Correlations as the hedge against short-term volatility to minimize our downward exposure. We also use a Multi-Factor Model to measure the portfolio tilt against Market Risk, Value, Growth, Size, Profitability, Investment, and Momentum. And, our Portfolio Construction Method allows us to optimize the expected returns given a level of risk.
We develop mathematical and statistical models to apply decades of academic research to investment solutions. Even though the models provide helpful insight, they are incomplete. It's in the gap between reality and a model, where sound judgement and experience matter. We believe in continuous improvement and commit to fine-tuning our method to close the model gap and increase the model certainty.
Long-Term and Data-Driven Investing have provided the foundation for Hivelr's investment approach. However, the success of the portfolios will depend on the actual trading executions, trust in the data, and enduring belief in the portfolio model despite the noise from the markets.
We continue to back-test our models, periodically rebalance our portfolios, and incorporate new data to reduce the model uncertainty. However, the most challenging aspect for any portfolio manager is when the news and markets go against our portfolio decisions.
Disciplined Investing allows us to make unpopular investment decisions, being a contrarian investor, and avoid speculations. It is a challenging situation in the short term as it may negatively impact the portfolio returns, but it will pay huge dividends in the long term.
Disruption is everywhere driven by innovation, technological breakthroughs, and shifts in consumer behavior. Disruptive Innovation is an innovation that creates a new market and eventually displaces the established market-leading companies.
For example, the arrival of the digital camera disrupted the chemical film business and killed Kodak. Netflix bankrupted Blockbuster by offering media streaming services. The launch of Apple's iPhone and App ecosystem wiped out Nokia and BlackBerry overnight. ExxonMobil was the largest company by market capitalization in 2013 and being kicked out of Dow Jones Industrial Average in 2020.
We conduct a thorough Disruptive Innovation analysis of every individual security because it is crucial to understand the difference between Undervalued Stocks vs. Disrupted Stocks. Both stocks have similar characteristics of declining share price and become Cheap Stocks, but only one of them will recover while the others will go bankrupt.
Average investors tend to dive into buying Cheap Stocks, following the Value Investing principle and Cigar Butts method popularized by Benjamin Graham and Warren Buffett. However, Cheap Stocks do not always mean profitable stocks because they could be Unrecoverable Disrupted Stocks like Kodak, Blockbuster, Nokia, and BlackBerry, including the original Berkshire Hathaway, a disrupted textile manufacturing company.
We carefully analyze the business model, sustainable competitive advantage, and industry competition through a fundamental analysis before making any investment decision. We design our hedge fund portfolios to establish a Long position in Undervalued Stocks and set a Short position in Disrupted Stocks. In the future, we plan to create a Multi-Factor Model to identify Disruptive Innovation at the portfolio level.
We factor our model against momentum and measure its impact on our portfolio. The momentum effect allows securities that perform well in the past to continue to do well, while those that perform poorly continue to do poorly.
We discover evidence that momentum, at both systematic and idiosyncratic levels, accelerates our portfolio growth faster than expected. However, it can be the source of volatility due to speculative trading by other market participants.
We evaluate the momentum effect carefully and fine-tuning our methods to minimize its negative impact and continue to accelerate our portfolio returns.
Hivelr Quantum Alpha falls into the Alternative Investment category and is only available to "Accredited Investors". Hivelr Quantum Alpha is NOT a licensed financial advisor, registered investment advisor, or registered broker-dealers. We only serve clients who agree with our terms and conditions. Investors should conduct their own analysis and consult with professional advisors before making any investment decisions. Past performance is no guarantee of future results. All information is given in good faith and without warranty (or guarantee) and should not be considered investment advice or an offer for any security for sale.
Quantum Alpha and Hivelr Business Journal refers to the Hivelr separate but affiliated entities generally, rather than to one particular entity. Hivelr is licensed and operated by GrandCliff Management Inc. (the "Legal Entity" responsible for any product and services under Hivelr name). Hivelr Quantum Alpha, and its operating company GrandCliff Management Inc., is not a licensed financial advisor, registered investment advisor, or registered broker-dealers. Investors should conduct their own analysis and consult with professional advisors prior to making any investment decisions. Past performance is no guarantee of future results. All information is given in good faith and without warranty (or guarantee) and should not be considered investment advice or an offer for any security for sale.