Under the Sustainable Finance Disclosure Regulation ("SFDR") and the Taxonomy Regulation, investment fund managers, such as SysCat Capital B.V., must provide sustainability related information.
SysCat Capital is aware of the importance of sustainability and the role of the financial sector in it. SysCat Capital does not specifically focus on sustainable investments or promoting environmental or SysCat features. As a result, the fund managed by SysCat Capital does not promote ecological or social characteristics (as referred to in Article 8 SFDR) nor does it have a sustainable investment objective (as referred to in Article 9 SFDR). Nevertheless, in compliance with the SFDR, SysCat Capital considered whether the effects of material sustainability risks on the value of the investments should be taken into account.
A "sustainability risk" (as defined in SFDR) is an environmental, social or governance event or condition that, if it occurs, could cause an actual or a potential material negative impact on the value of the investment. These risks include, but are not limited to, climate change transition and physical risks, natural resources depletion, waste intensity, labour retention, turnover and unrest, supply chain disruption, corruption and fraud and human rights violations. A sustainability risk trend may arise and impact a specific investment or may have a broader impact on an economic sector, geography or political region or country. The impacts following the occurrence of a sustainability risk may be numerous and vary depending on the specific risk, region and asset class.
The investment strategy applied by SysCat is of quantitative nature. The investment process is based on quantitative tools and relies entirely on the decisions of computer algorithms and the human intervention is limited to a minimum. The strategy contains both directional and market-neutral trading engines. The directional engines trade short-term signals driven by market microstructural patterns. While the market-neutral engines capitalize on relative price anomalies of two or more statistically correlated securities before reverting to equilibrium. Sustainability risks typically unfold over medium- to long-term horizons, such as months or years, whereas high-frequency and intraday trading strategies operate on timeframes of minutes or hours. This fundamental mismatch in time horizon means that sustainability related risks are unlikely to materially affect the value of investments during the short window in which positions are held. Moreover, sustainability data itself is generally low-frequency. Ratings and sustainability indicators are updated on a quarterly or annual basis, making them unsuitable as predictive inputs for short-term price movements. Considering the characteristics of the investment strategy of SysCat, SysCat does not take sustainability risks into account when making investment decisions.
Under the AIFMD registration regime, SysCat Capital is not required to adopt a remuneration policy. Given the limited size of the organization, it has not been decided to draw up a specific (voluntary) remuneration policy. Due to the absence of (an obligation to draw up) a remuneration policy, SysCat Capital will not integrate sustainability risks in such policy.
Dated 2025-08-26