By Oi-Yee Choo, Chief Executive Officer of ADDX
At a time of considerable headwinds in the markets, ADDX raised in 2Q 2022 a round of capital from a noteworthy list of new shareholders.
We announced in May that the Stock Exchange of Thailand, UOB, Hamilton Lane and Krungsri Finnovate had joined a Pre-Series B round that attracted US$58 million in fresh funds, bringing total capital raised since our inception in 2017 to around US$120 million.
Significantly, these four new companies, as well as those they join on the ADDX cap table, are important ecosystem players: stock exchanges, banks, private equity managers.
They are best positioned to assess the ADDX project: how likely our plans are to succeed based on the team we’ve assembled and the platform we’ve built so far.
In other words, they looked under the hood with expert, well-informed lenses and decided to come on board. We are grateful for their support.
ADDX shareholders contribute a lot more than capital. They are also our strategic partners. Together, we explore ways to collaborate to better serve the needs of our respective clients, to expand into new markets, and to build new businesses.
A good example is our partnership with Tokai Tokyo Financial Holdings, an ADDX shareholder and one of Japan’s oldest brokerages.
In 2021, Tokai Tokyo worked with ADDX on a real estate deal in Japan. The fund offering was tokenised by ADDX and subsequently distributed to Japanese clients by Tokai Tokyo.
There is ample scope for us to embark on similar strategic partnerships with each of our shareholders, building on one another’s strengths as we make a positive and transformative impact on the capital markets.
Singtel, Fullerton raise capital on ADDX
In the second quarter, we also added to the list of blue-chip offerings on ADDX.
First, Singtel issued a US$100 million digital bond on ADDX. UOB was lead manager for the five-year, sustainability-linked bond carrying a coupon rate of 3.56% per annum. This also marked the successful pricing of Singapore’s largest foreign currency digital bond.
Singtel demonstrates its leadership with this deal, being an early adopter of digital bonds.
Digital bonds promise to bring change to the archaic and inefficient global bond issuance and distribution infrastructure.
The deal also underlines the role that digital securities are set to play in combating climate change, as the technology is cost efficient and gives issuers considerable flexibility on bond size, which will make capital raising easier for a larger number and wider range of impactful projects.
Second, Fullerton Fund Management listed a private equity fund of funds on ADDX. The Fullerton Optimised Alpha Fund is a seven-year, closed-end fund targeting 8% to 12% in returns per annum. Fullerton is part of Seviora, a multi-asset management group established by Temasek.
As an experienced fund manager that is part of the Temasek family, Fullerton offers investors deal flow to difficult-to-access funds as well as a rigorous and proprietary method for narrowing down the list of private equity funds – from over 20,000 to the final six to eight that are invested in.
Singtel and Fullerton join a well-respected list of blue-chip names on ADDX, including Hamilton Lane, Partners Group, Mapletree, Azalea, SeaTown, Sembcorp, Investcorp and CGS-CIMB.
The latest deals underscore ADDX’s approach to serving investors: We bring to the table fund managers and issuers of the highest quality and in a steady stream, to allow investors to build a private market portfolio over time.
These deals undergo a robust screening process covering track record, audited financial statements, background checks, as well as corporate governance and compliance considerations. A listing committee consisting veterans of the financial industry assesses a deal for listing only if it is satisfied that the criteria has been met across all these key variables.
ADDX funds outperforming public markets
This is the reason ADDX offerings showed resilience, even as public stock markets wobbled in the first half of 2022. Our liquid private equity funds and hedge funds outperformed MSCI World, a global public equity index.
Amid the broad and deep market correction in the first six months of the year, MSCI World Index fell by 20.51%. In comparison:
- Performance of private equity funds by Hamilton Lane and Partners Group on ADDX stood at -0.51% and -5.99% respectively, outperforming MSCI World.
- Performance of hedge funds Ternary Cypress and iQuant Series I stood at +18.68% and -15.35% respectively, also outperforming MSCI World.
Hamilton Lane and Partners Group are renowned global general partners and their funds on ADDX provide exposure to globally diversified private equity.
Ternary Cypress is a hedge fund focused on real asset sectors such as nuclear, oil tankers and specialty engineering. IQuant Series I is a feeder fund to the top-ranked macro hedge fund Quantedge Global Fund, whose annualised returns stand at 21% since inception in 2006.
The rocky ride in the public markets this year has highlighted the need to think outside of the traditional framework of a 60-40 portfolio, consisting public stocks and bonds.
Private market diversification can provide investors with a wider range of options for wealth preservation. Besides private equity and hedge funds, strategies like private credit, short-term commercial papers and private REITs are opportunities worth considering in the face of increased market turbulence.
Open your account on ADDX and start investing in the private markets.
ADDX is your entry to private market investing. It is a proprietary platform that lets you invest from USD 10,000 in unicorns, pre-IPO companies, hedge funds, and other opportunities that traditionally require millions or more to enter. ADDX is regulated by the Monetary Authority of Singapore (MAS) and is open to all non-US accredited and institutional investors.