Kernow Equity Navigator Fund

The Kernow Equity Navigator Fund employs an equity long/short strategy focused on the UK market. Managed by Alyx Wood (CIO) and Edward Hugo (CEO), the team seeks to identify and exploit value opportunities with identifiable catalysts across its investable universe of approximately 1,600 stocks, of which around 500 are actively monitored. The fund's sweet spot is typically companies with limited market coverage (small and mid caps) or those whose underlying fundamental value has been misinterpreted by the broader market. To identify such opportunities, the team has developed a codified investment process that combines quantitative screening with discretionary validation. The screening framework focuses on valuation, quality, and sentiment metrics to identify stocks trading away from their fundamental value, while extensive fundamental research is conducted on prospective portfolio candidates. In addition, the team leverages its network of market participants, company boards, corporate financiers, industry experts, and consultants to develop tradable insights. On the long side, the team looks for companies with strong margins, pricing power, and the ability to pass on costs, led by management teams with significant skin in the game and the ability to reinvest capital at IRRs of 20% or higher. On the short side, the focus is on fads, failed business models, and frauds or companies exhibiting accounting red flags. The final portfolio typically comprises around 40 positions split between longs and shorts, with exposure reasonably concentrated in the highest-conviction ideas (up to 10% on the long side and up to 3% on the short side). Gross exposure is approximately 150%, while net exposure is typically > 50%.