Ing. Ludvík Miška: “Thanks to the selection of investments, we were able to achieve appreciation in excess of 40% for performance investment stocks.”

Ing. Ludvík Miška, young blood at r2p invest SICAV, a.s., where he acts as a fund manager. How did he get to the qualified investor fund, what does he enjoy about this job and how has the company under his management been doing lately? This is not only what the following interview is about.

1. You are currently acting as a fund manager for r2p invest SICAV. Could you give us a little bit more insight into the fund and your position in it?

r2p invest SICAV, whose equity capital today exceeds CZK 1.6 billion, focuses on investments in companies engaged in purchasing and collecting overdue receivables. The fund leverages the owners’ and team members’ many years of experience, expertise, and extensive network of contacts in financial institutions worldwide. As a result, it is able to purchase receivables at an average of between 1-3% of face value. It then places these receivables with its call center subsidiaries. They then service these receivables. By combining the investor and the operator into one group, the fund is able to achieve superior risk-adjusted returns.

The operations in r2p invest SICAV are perfectly managed by the owner of the company. I, as a member of the investment committee, (dis)recommend the allocation of free funds, both for capacity expansion and portfolio selection purposes. Thanks to the investment selection by our team, we were able to achieve appreciation in excess of 40% for investment performance stocks last year.

2. Your role directly in the Fund is relatively fresh. What was the journey that brought you here?

It was a fairly natural path. During my university studies, I started with a part-time job at EY in the Financial Accounting Advisory Services team. Subsequently, my friends and I set up an algorithmic trading firm and I focused on individual stock portfolio management. We gradually phased out the algorithmic trading, but I continue to manage.

Then, during the summer, I was offered the position of Asset Management Director at Avant Investment Company. And that’s where the fateful luck came when one of my clients was the r2p invest fund. After 2 years at Avant, I decided that it was time to move on and after a short intermezzo, I decided to join the r2p group, which had already attracted me as a client.

3. What finally made you start a new cooperation and move from AVANT to the team of r2p invest SICAV?

It was mainly two things. The first impetus was the management of the company and its team, with whom I worked on the management of the r2p invest fund. More specifically, I found them to be professionals with a friendly approach. Moreover, it is an environment where I feel I can continue to learn and develop. All this with the added bonus of international reach as we have offices all over the world from Singapore to the US. And I have the opportunity to visit all our branches and call centers.

The other thing was a beautifully statistical business where you have to know what to buy, for how much, and what the probability is that you will get a return on a given portfolio. And I enjoy that.

4. Last year, you were part of a rather fundamental decision to get rid of all Russian ties within the Fund. Was this a positive step for the Fund?

It was certainly a positive move, particularly in terms of reducing the risk that these investments carried. We were able to divest on favorable terms for our fund, despite the turbulent period that was last spring. For holders of the VIA share class, this has reduced volatility compared to if we had not divested these ties. And for holders of PIA and other stocks, it means greater certainty in the guarantee mechanism.

5. The fact that the Fund is really doing well is evident from the latest annual report. The value of the performance investment share (VIA) has climbed to 40.55% and the preferred investment share (PIA) to 9.6%. Can you explain how this increase is significant?

The 40.55% increase in VIA is certainly crucial for its holders. That is, first and foremost, for the fund’s founders, the management group, and the partners who have contributed to our success by providing capital. It is also great news for PIA holders, for whom VIA “guarantees” a return of up to 9-10% p.a. PIA shareholders see that the fund has sufficient reserves to maintain this return. At the same time, the ratio of VIA: PIA shares is less than 1:1, with up to 1:3 stated as safe.

6. Are there any other achievements from the annual report that you would like to mention?

First of all, the excellent performance of our Singapore office continues to surprise us. Its purchased debt portfolios are earning more than we had anticipated and it is clear that the Fund’s valuer and auditor have factored this into its value in the financial statements.

7. The Fund seems to be experiencing a really successful period. What are your plans for the near future?

In the near future, we will further develop high-margin countries and buy in these regions of the portfolio. Specifically, this is primarily in Southeast Asia, however, the Americas look like they could carry similar returns. And in doing so, we hope to build another high-margin region – this time on the other side of the planet.

8. There is talk that you are going to open a new self-management fund. Can you give us some details about it now?

It will be a sister fund to r2p invest with a slightly different relationship between the fund and the investor. However, the target assets will be basically the same. We can certainly look forward to details from Petr Žáček soon.

9. As a fund manager of r2p invest SICAV, you have an overview of everything that is going on inside. How would you convince potential investors that they should invest with you?

I don’t think there is any need to convince potential investors – anyone can look at our history and see that r2p invest SICAV has had several successful years where it has exceeded expectations every time. Today, its assets exceed CZK 1.6 billion, it maintains a highly secure VIA: PIA ratio, and it is able to share high but non-volatile returns with all investors.

If even this is not enough for the hesitant investor, I can at least reveal that we are at the peak of the debt cycle phase. This means that we are able to buy cheaper than in previous years, and the fund’s performance will reflect this. This is especially true in the coming months, which is why we are holding higher levels of returns and rewards for all partners. However, we expect to reduce the level of rewards from next year onwards as the debt market and interest rates return to normal.

10. Is there anything else you would like to say to the readers in conclusion?

Finally, I would like to thank not only my colleagues but also the partners and investors who have shown their trust in us, especially during the difficult years. Thanks to this, together we have been able to capitalize on our investments. I believe that everyone is satisfied with our performance so far and we will continue to remain in their favour. Without them, we would never have had the resources that allow us to be reliable partners and buy portfolios profitably.