Summary investment strategy
NAXS’ strategy to realise the potential in private equity as an asset class is to create a fund portfolio that is (i) concentrated regarding geographical area, fund orientation and fund managers, and (ii) diversified regarding the underlying funds’ size and “vintage”. The strategy reduces the negative exposure that each of these risk dimensions may give rise to, simultaneously as a certain excess return in one of the funds is allowed to influence the return.
The strategy is based on a disciplined and selective method when identifying private equity funds for the portfolio, with a constant balance of demands for a focused and simultaneously diversified portfolio. A portfolio composed of investments in or commitments to about 7–10 different fund managers’ underlying funds of various vintages, are normally considered to create such balance.
The investment strategy for NAXS embraces both the investment commitments to private equity funds through their primary fund raisings and investments in already existing funds through the opportunistic acquisition of fund interests on the second-hand market.