Corporate events

According to the U.S. Securities and Exchange Commission Raison Asset Management investment adviser registration is currently effective and was effective at or before that time. As we meet these criteria we are required to file an annual updating amendment to Form ADV.

Such annual updating amendment was filed by Raison Asset Managemen on 22 March 2020. You can view the latest ADV form file from the US SEC IAPD. In addition to the amendment of ADV Form we updated the Part 2A Firm Brochure which is available on our website or on US SEC IAPD.

Mining.VG


Issuer: RAM Data Technologies INVT LTD
CUSIP Number: G7369L 106
ISIN Number: VGG7369L1067
Issue Description: EUR CL C SHS
ISO CFI: CICJMS

The total market capitalization of cryptocurrencies decreased by 4.25% from $ 259 billion to $ 248 billion.

BTC: -8,62%;
ETF: +21,03%;
XRP: -4,17%;

66823847

Source: coinmarketcap.

In general, the news background over the past month has been positive for the cryptocurrency market. We single out the main ones:

• February 5, 2020 the number of confirmed transactions in the Bitcoin network reached 500 million;
• The US Federal Reserve has begun to study the digitalization of the dollar;
• SEC plans to simplify fundraising through ICOs for cryptocurrency companies;
• The Central Bank of China has filed 84 patent applications for technology related to digital payments. The country is actively preparing to launch its own cryptocurrency;
• In India, they again opened the legal road to the cryptocurrency market;
• The ban on the placement of cryptocurrency Durov extended indefinitely;
• Binance added the ability to purchase BTC, ETH, BNB and XRP for rubles on a Visa card;
• Ripple announced a partnership with money transfer provider Intermex;
• After the entry into force of the Fifth EU Directive on combating money laundering, the German regulator BaFin received more than 40 “evidence of the interest of banks in the conduct of the crypto-custodian business”. Now regulated financial institutions are allowed to work with BTC and ETH.

The fund showed a slight negative dynamic of -0.4% in February, so since the beginning of the year, the growth in the price of a share taking into account the coupon paid has been + 1.16%. The equipment of the fund also works on the most profitable algorithm of recent months - Ethash.

The rates of the main cryptocurrencies showed different dynamics in February, and if Ethereum increased from 161.47 EUR to 197.26 EUR, then Bitcoin at the initial price of 8420.25 EUR, lost 679.25 EUR and stopped at around 7741.00 EUR.

Also, in February, a complete inventory of the fund’s assets was carried out, the results will be provided to investors individually in the near future.

Element ONE


Issuer: ELEMENT ONE LTD 
ISIN Number: VGG299771086
Issue Description: USD CL B SHS
ISO CFI: CICXXX

In the first half of February the S&P500 reached its next maximum at $ 3 393 followed by a rather sharp correction. According to the monthly results, S&P500 lost 8.41%.

The main drivers of the fall were the overbought market and the spread of the coronavirus.

As you know, since December 2019, the epidemic has spread rapidly inside China, and in February the virus spread rapidly in Italy, Iran and South Korea.

Market conditions in February:

• Decrease in production;
• Stock growth amid declining demand;
• Deterioration of mood and undermining business confidence;
• Decrease in forecasts of world GDP growth;
• Expectation of the profound effects of coronavirus on the global economy;
• Sales at financial sites.

It is worth noting that already at the end of February optimistic news began to come about a relatively quick recovery of the Chinese economy. Assessment of the degree of recovery of economic activity in China from China International Capital Corporation (CICC):

61.3% as of February 26;
66.9% as of March 1;
70.7% as of March 3;
73.3% on March 4.

According to the results, the volume of transportation of goods by rail of the PRC increased by 4.5% compared with the previous year.

To reduce the risks of a recession caused by a downturn in economic activity in China, the US Federal Reserve lowered the rate by 0.5% in March 3, 2020.

Gold, which added more than 4% in January, fell by less than 0.5% in February. At the same time, a new maximum was set within a month from March 2013 at around $ 1,689.

The risks

China accounts for 16.3% of the global economy, according to IHS Markit. Slowing China's economic growth due to the spread of the virus can have a ripple effect around the world, so carefully monitor the news on this issue.

According to the results of February 2020, the Element ONE fund showed a result of -4.32%.

According to the strategy described in the results of 2019, the fund distributed a part of its assets in gold, which, together with an increase in volatility (an increase in the value of protective options on VIX), made it possible to reduce the negative impact in the crisis month.

Given the correction of the S&P500 index by almost 20% from historical highs, now is a great time to return to the market. After the OPEC agreement was broken and oil fell by more than 30% in one day, Element ONE began to open long positions in the ETF for oil.

At the time of this writing, the fund’s latest investment, Salmar, is trading at -1% of the entry price, with the maximum drawdown from the time of purchase not exceeding 10%. Updates can be tracked at the link.

Element ONE


Issuer: ELEMENT ONE LTD 
ISIN Number: VGG299771086
Issue Description: USD CL B SHS
ISO CFI: CICXXX

The first half of January was very active for the American market. The SP500 continued to set new historical highs, breaking the $ 3300 level as early as January 16th. However, after a positive start to the year, news about the spread of coronavirus forced the market to adjust, ending the month with a result of -0.16%. The price of the fund’s unit at the end of the month showed a value of $ 1,683.44.

Gold in the first half of January set a new local maximum, exceeding the mark of $ 1,600, while showing a 4.8% result for the month.

Oil in January showed a negative trend, losing about 15%, mainly due to a decrease in tensions in Iran, an increase in US stocks of raw materials, an increase in forecasts for oil production in 2020 (US Department of Energy), and concerns about a decrease in consumption in China.

The optimism of the first half of January was primarily due to the expectation of the signing of the first phase of a trade agreement between the United States and China. As a result, on January 15, 2020, an agreement was signed under which China promised to purchase $ 200 billion worth of goods and services in the United States within the next 2 years, while the United States would halve duties on imported Chinese products by $ 120 billion.

The fundamental indicators of the US economy in January showed mixed movement. On January 10, data were published on the number of new jobs in non-agricultural areas. The increase amounted to 145 thousand jobs, against expectations of 164 thousand.

On January 16, US retail sales data were released. The data indicates an increase in sales by 0.5% against expectations of 0.4%.

January 28 published data on orders for durable goods. The growth was 2.4% against expectations of 0.5%.

The portfolio of the Element One fund showed a negative result, down 0.27%.

Mining.VG


Issuer: RAM Data Technologies INVT LTD
CUSIP Number: G7369L 106
ISIN Number: VGG7369L1067
Issue Description: EUR CL C SHS
ISO CFI: CICJMS

Major currencies rose all January. By the end of the month, the main currency in which the equipment of the fund operates - Ethereum showed a rate of October-November 2019, while the complexity of the network fell sharply at the very beginning of the year to the level of May-June 2019. It is also worth noting that in the first week of January, Ethereum grew faster than Bitcoin, XRP, Litecoin, EOS and Binance Coin. The exchange rate at the beginning of the month is 115.19 EUR, at the end of January - 161.47 EUR. The main cryptocurrency - BTC showed a monthly increase of more than 2000 EUR, showing the final value - 8420.25 EUR.

Against the background of such indicators, we once again became convinced of the right choice of equipment managed by the fund - video cards in the long run show themselves to be much more stable in terms of results and a profitable investment. 

The fund showed high positive dynamics in January + 1.56% (the dynamics is indicated taking into account the coupon paid to investors). This indicator, as well as the dynamics of factors affecting the profitability of mining, allow us to look with optimism at the prospects of the fund.

In January, a coupon for the 4th quarter of 2019 was paid to investors.

Since the beginning of 2020 changes in the investment management remuneration have been agreed between the Element ONE fund and the investment management company. The success fee from 2020 will be 22%, instead of the previously used 25%, but the Hurdle Rate will be removed, which since 2017 has been set at the ICE LIBOR 1 YEAR USD plus 0.15% (about 2.1% for 2019 year).

For the maximum convenience of clients in determining the NAV of the fund the commission for success will be taken into account in the monthly calculation of the fund's share price. This was made possible thanks to the cancellation of the Hurdle Rate - earlier we had to wait for the end of the year to calculate commissions due to the need to take into account the final average annual rate of LIBOR.

These changes will simplify calculations for customers and further enhance transparency. All changes will be reflected in corporate documents and are available on the RAISON ASSET MANAGEMENT website on the fund page until the first NAV fund calculation in 2020.