System Capital, established by Lev Margolin in 2022, will benefit from Fidante's minority equity stake, which includes an agreement for exclusive distribution of the System Capital Long/Short Fund. This deal positions System Capital among an elite group of 19 other managers in Fidante’s network, who specialize in a range of asset classes including fixed income, global equities, and sustainable investing.
Victor Rodriguez, Chief Executive of Funds Management at Challenger, commented on the partnership: "We are excited to be partnering with System Capital. We believe Lev Margolin’s expertise in long-short investing, combined with the extensive experience of the System Capital team, presents a unique opportunity for Australian investors looking to take advantage of under and overvalued global stocks."
Rodriguez emphasized the importance of active management and specialist insights in today's competitive investment landscape. For Challenger, aligning with independent managers is a strategic move to provide investors access to premier active fund management across varied investment styles and capabilities.
The System Capital Long/Short Fund aims to deliver reliable returns while offering downside protection. By leveraging deep fundamental research, the fund targets pricing inefficiencies between a business's market valuation and its intrinsic quality. Importantly, the fund is structured to navigate market volatility effectively, adjusting its exposure as necessary. Indeed, as of December 2024, the fund had achieved an average annual return of 24.3% (before fees) since its launch in October 2022.
Speaking about the fund’s strategy, Lev Margolin stated, “Our Fund is not constructed with a specific investment thematic or qualitative overlay. Rather, we look to take advantage of structural winners and losers within specific industries to deliver absolute returns.”
Margolin also described the collaboration with Fidante as a pivotal growth opportunity: “We see our partnership with Fidante as a natural evolution of our business. It brings a new and differentiated investment strategy to the Fidante stable and allows us to grow our investor base. Our business remains majority-owned by our team, and we will continue to reinvest in the growth of the business.”
This new partnership is part of Fidante's broader strategy to expand its reach and depth in the investment sector, offering unique solutions to meet the varying needs of sophisticated investors.
The insights in this article were informed by original reporting from a recent press release issued by Fidante and Challenger Group, highlighting their latest business developments and strategic initiatives.
