The Soteria Micro Fund, is the latest venture from K2 Capital. It aims to pioneer the application of AI-driven hedging strategies within the volatile financial markets of East and Southeast Asia. K2s Oliver Tedja and Ravi Chari have formed a micro fund to test AI-led hedging strategies. The fund was led by investors from Hong Kong and Jakarta.
K2 Group is a Hong Kong-based investment firm handling projects throughout East & South East Asia. The group operates mainly as a single family office providing investors and partners with access to a broad range of private asset investment opportunities, portfolio building blocks and customised private asset strategies. With a range of investment strategies in: secondaries, venture capital, infrastructure, securitised products, asset-based finance, and impact investing. In the month of February, K2 founder Oliver Tedja, and manager Ravi Chari, have closed a round of funding for their Soteria Micro Fund. The fund is focused on selling and trading options contracts.
Both Tedja and Chari view great potential in automating their trading and analytical strategies. Believing it will reduce the potential failures from human error and emotion, keeping the operation strictly mathematical. The fund they’ve established, aptly named Soteria, after the Greek goddess of security and preservation, perfectly encapsulates the fund’s core principles.
Options trading is a specific type of financial instrument used as a risk management tool. It allowing investors to hedge assets and generate passive returns while simultaneously mitigating risk. This type of trading utilizes option strategies involves the simultaneous and often mixed buying or selling of one or more options. Each of which may differ in one or more variables such as strike price, expiry date, or the underlying asset.
A key component of these strategies is the call option, often referred to simply as “Calls”. A call option grants the holder the right, but not the obligation, to purchase a specific stock at a predetermined price, known as the option’s strike price. It’s an instrument that allows investors to speculate on the upward movement of a stock’s price, all the while limiting their potential loss to the premium paid for the option. This aligns with the principles of the Soteria Micro Fund, which strives to limit risk while capitalizing on potential market gains.
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