We offer commingled strategies to enable clients to invest in hedge fund solutions directly alongside the family offices of our founders. Our team executes a rigorous investment process of manager sourcing and screening, due diligence, portfolio construction, and monitoring. We couple this investment discipline with comprehensive operational due diligence. We source managers who have a proven track record, discernible research edge, repeatable investment process, sound business model, and full alignment of interests. We invest only with a limited number of these sourced managers and believe that ultimate diversification comes from the aggregation of their underlying portfolios. In our commingled strategies, we are constantly and consistently evaluating each manager to maximize the overall return-to-risk potential. There are three distinct commingled strategies, including long/short equity, global macro, and absolute return.
Within the hedge fund industry, long/short equity is the oldest and most prevalent strategy. We are attracted to the fundamental building blocks of this strategy with the belief that strong security selection, both long and short, leads to superior performance with limited directional market risk. We invest only with a limited number of managers who deliver alpha-oriented returns and who are uncorrelated complements to each other in a long-term, multi-manager portfolio. We believe this approach provides unique, active equity diversification within sophisticated asset allocations for individuals and institutions.
Utilizing both a top-down and bottoms-up approach, we believe our asset allocation is differentiated in the global macro marketplace. Our approach is to generally allocate around half of the fund to discretionary, fundamental managers who are able to adapt quickly to changing market environments. These managers exhibit similar return objectives, but historically have provided more consistency of returns, while lessening volatility and drawdowns. Additionally, we search for the best managers available, with a focus on relatively undiscovered or “niche” managers. The majority of our managers are small in asset size, but deep in experience and talent. By constructing a portfolio that allocates to these focused managers while also tilting to discretionary, fundamental strategies, we believe we are well-positioned to produce excellent risk-adjusted returns over the long-term.
We believe in building a diversified portfolio capable of generating consistent returns across a broad range of market environments. We are focused on delivering risk-adjusted returns with moderate volatility and correlation to traditional markets. We generally allocate to four sub-strategies – hedged equity, event-driven, relative value, and global macro. Based on our past experience and judgment, we focus on optimal, long-term allocation among these strategies to maximize portfolio diversification.