Upslope Capital’s defensive strategy generated solid returns in the first quarter of 2023, outperforming long-only market indices. Despite the recent market correction, the strategy remained well-protected against potential macroeconomic and geopolitical shocks.
The fund’s portfolio positioning reflects numerous opportunities on both the long and short sides. Notable long positions include Barry Callebaut and Hershey Foods, two consumer staples companies that are well-positioned to navigate the current cocoa crisis.
Barry Callebaut, the world’s largest chocolate manufacturer, is expected to benefit from its vertically integrated model and strong sourcing capabilities, which provide a competitive advantage during supply disruptions.
Hershey Foods, with its scale and experience in the chocolate industry, is also expected to gain market share during this challenging period. Both companies trade at attractive valuations, offering potential upside when the cocoa crisis subsides.
Upslope also exited its long position in Intel during the quarter, reallocating capital to more promising opportunities. The fund’s uncorrelated portfolio, which differs significantly from traditional equity strategies, provides investors with an attractive investment option.
Upslope Capital remains optimistic about the prospects for its defensive strategy, believing that the recent market weakness may present opportunities for undervalued and resilient companies.
