‘We build a harmonious portfolio based on market noise’

Vincent Weber: Traditional 60/40 portfolios are under increasing pressure, as many liquid alternatives are either too narrowly focused or too sluggish. Resonanz Jazz Multi Strategy (‘Jazz’ for short) (ISIN: DE000A40RD16), on the other hand, relies on dynamic diversification across different return drivers, strategy types, and liquidity sources, with no style constraints.

What defines 'jazz' at its core?

Vincent Weber: At its core, it combines quantitative investment strategies (QIS) with discretionary UCITS mandates through an open architecture. This is complemented by active allocation, which is not a static mix, but rather a deliberately managed approach that ensures strong governance within the UCITS framework. This provides institutional investors with comprehensive diversification from a single source.

Doesn't a fund of funds approach, such as 'Jazz', result in double fees?

Vincent Weber: That concern is understandable. Our goal is to achieve a competitive all-in cost structure. To this end, we focus on three factors. Firstly, wherever they offer compelling net value, we use cost-efficient QIS modules.

Second, we actively pursue substitution. This means that we only allocate to more expensive strategies in fund wrappers if they can clearly demonstrate additional value compared to QIS. The third factor we employ in 'Jazz' is active governance from a single source, providing centralised access, consolidated reporting, and a clear, standardised fee model within the UCITS framework.

How would you describe the sound of 'Jazz' in the portfolio? Can you capture the essence of the music in an image?

Iliyan Iliev: Gladly. You can imagine the interplay in the fund as being like a trio. The drums represent convergence strategies that benefit from price adjustments and generate steady returns. The piano symbolises long-biased approaches that capture trends in equities and bonds. Finally, the double bass represents divergence strategies driven by significant market movements and volatility, providing stability. Together, these elements create a harmonious sound that we continuously fine-tune, just as in a real jazz session.

How do you select and manage the building blocks?

Iliyan Iliev: We typically select 30 to 40 strategies from a universe of more than 3,500 liquid alternatives, completely independently of the provider. Since alpha is often not very persistent in highly liquid approaches, we rotate in a disciplined manner and adjust the weightings. We do not view diversification as a fixed state, but rather as an ongoing process.

Who is 'Jazz' aimed at, and how is it used?

Vincent Weber: The fund is aimed at professional investors, including private wealth managers, family offices, foundations, and institutional investors, who are looking for liquid, broadly diversified alternatives. Typical use cases include replacing bond portfolios with a particular focus on minimising drawdowns while accessing real returns beyond those of traditional fixed-income sources. The fund can also serve as the core building block for a liquid alternatives allocation, providing structured exposure to the most attractive strategies without the complexity of managing numerous individual components.

Now, back to Resonanz. Who are you?

Vincent Weber: Resonanz Capital was founded in Frankfurt in 2019. We are an independent investment advisor regulated by BaFin, with around 15 years' experience in asset allocation and analysis of more than 10,000 alternative investments. Our primary goals are access, governance and transparency.

How do you ensure liquidity and governance?

Iliyan Iliev: We work with highly liquid instruments and subject them to strict liquidity controls. We also ensure clear governance within the UCITS framework, including daily liquidity and clearly defined roles for the asset management company and the custodian.

Your conclusion in one sentence?

Vincent Weber: 'Jazz' brings the diversity of a multi-manager hedge fund into an investor-friendly UCITS structure, offering open architecture, active allocation and daily liquidity — a trio that performs well in every market phase.