DCM Systematic Advisors Secures FINMA Authorization, Marking a Milestone in Its Growth Journey

DCM Systematic Advisors, an independent quantitative asset manager based in Geneva, has achieved a significant milestone by obtaining collective asset management authorization from FINMA, the Swiss financial regulatory authority. This approval, granted in November 2021 and announced this February, is a testament to the firm’s commitment to quality and transparency. Gaëtan Maraite, CEO of DCM Systematic, emphasized the importance of this achievement, describing it as "an additional guarantee of quality for investors and a formalized mark of excellence."

Since the implementation of the Financial Institutions Act (LEFin) in January 2020, asset managers handling investment assets professionally are required to obtain this authorization. DCM Systematic, founded in 2014 by Anthony Dearden, Jérôme Callut, and Gaëtan Maraite, has positioned itself as a "quantitative research boutique" and has experienced rapid growth, doubling its assets under management in the past year to nearly CHF 400 million. The firm is now targeting CHF 600 million by the end of the year.

The firm’s journey began when Dearden and Callut, drawing on their experience with the major Anglo-American hedge fund BlueCrest, decided to establish their own multi-strategy quantitative investment firm in 2013. They spent several months developing an advanced risk management approach before meeting Gaëtan Maraite, who was then working at Pictet, during the structuring of their Luxembourg-based fund, Diversified Alpha. By 2015, the fund was fully operational, with Pictet Asset Services providing crucial support during the early stages, despite the fund’s small initial size.

Maraite, who joined DCM as CEO in 2017, acknowledged the challenges of launching an asset management firm in today's highly regulated and competitive environment. "Starting a new company in this field is incredibly challenging, and success requires everything to align perfectly," he noted.

The firm, which currently has eight employees, is planning to expand its team as part of what it describes as "controlled growth." In a recent recruitment drive for a quantitative analyst position, DCM received 160 applications, reflecting its growing reputation. The newest team member, a dual graduate of the University of Geneva and EPFL, is set to join on March 1.

DCM Systematic’s client base is geographically diverse, with one-third of its investors from Switzerland, another third from Europe, and the final third from the United States. "The Swiss reputation for quality management and robust regulatory oversight is highly regarded in the U.S.," observed Jérôme Callut, head of research at DCM Systematic.

The firm’s approach to asset management is distinguished by its transparency and continuous research efforts. "Everything we do is explainable and explained, which is why we have never lost an investor," Maraite emphasized.

DCM Systematic employs a systematic strategy that aims to provide investors with returns that are strongly uncorrelated with traditional asset classes like equities and bonds, as well as with alternative risk premia. The firm’s multi-asset forecasting techniques and convex portfolio optimization methods are designed to find a different path to alpha. This approach proved highly effective in 2020, delivering a performance of over 18% during a year of extreme market conditions.

Callut highlighted that their strategy typically has zero to negative correlation with equity indices like the S&P 500, thanks to the signals used in their twenty models and their comprehensive risk management framework. This includes the consideration of adverse scenarios, such as shocks to equity or commodity markets, which adds a defensive element to their portfolios.

As DCM Systematic continues to grow and expand its offerings, the firm remains committed to its core principles of transparency, rigorous research, and innovative quantitative strategies. The FINMA authorization marks a new chapter in their journey, providing a solid foundation for future success.