Tag Archives: brian-haskin

2 New Multialternative Funds Hit The Market

In the week that saw February transition into March, two new multialternative mutual funds were launched: the Preserver Alternative Opportunities Fund (MUTF: PAOIX ), which first traded on February 29; and the PineBridge Dynamic Asset Allocation Fund (MUTF: PDAIX ), which debuted on March 2. Preserver Alternative Opportunities The Preserver Alternative Opportunities Fund’s investment objective is to provide current income and capital appreciation with low volatility compared to traditional stock and bond markets. In pursuit of this end, the fund employs three distinct alternative strategies: Event driven Structured credit Tactical trading Although Semper Capital Management is listed in the fund’s prospectus as a sub-advisor, Preserver Partners CIO Floyd Taylor will initially manage all or most of the fund’s assets. As the fund’s assets under management (“AUM”) increase, Mr. Taylor may allocate a portion of those assets to be managed by the sub-advisor, and the fund may add other sub-advisors, as well. As of March 7, the fund’s AUM stood at just $8.8 million. The Preserver Alternative Opportunities Fund’s institutional class shares have a minimum initial investment of $100,000 and a net-expense ratio of 2.18%. The retail class (MUTF: PAORX ) shares have a minimum initial investment of $2,000 and a net-expense ratio of 2.43%. PineBridge Dynamic Asset Allocation The PineBridge Dynamic Asset Allocation Fund was launched with $50 million in seed capital. It pursues its investment objective of providing absolute return by allocating across a broad range of asset classes, taking both long and short positions in stocks, bonds, ETFs, REITs, and more. According to the prospectus , the fund’s secondary objective is generating alpha, with investment selections based on the advisor’s macroeconomic views, fundamental analyses, and risk-management considerations. PineBridge was also the sub-advisor to the Redmont Resolute Fund I, which was liquidated in December 2015, and the firm still is the sub-advisor Redmont Resolute Fund II (MUTF: RMRGX ). Version “I” of the fund was liquidated despite 2015 performance in the top 15% of its peers, while Version “II” had annualized three-year gains of 1.50% through February 29, ranking in the top 34%. The PineBridge portfolio management team thus has a solid track record of outperformance. Shares of the PineBridge Dynamic Asset Allocation Fund are available in institutional and investor-servicing (MUTF: PDAVX ) classes. The institutional shares have a minimum initial investment of $1 million and a net-expense ratio of 0.65%. The investor-servicing shares have a minimum initial investment of $100,000 and a net-expense ratio of 0.80%. Past performance does not necessarily predict future results. Jason Seagraves contributed to this article.

The Best And Worst Of February: Managed Futures

Managed futures mutual funds and ETFs had a strong month in February, with the average fund in the group returning +1.77% while the S&P 500 Index dropped 0.13% and the Barclays US Aggregate Bond Index gained 0.71%. Most funds generated positive returns for the month, and the top three funds gained between 3.67% and 6.34%, while only two funds in the entire category lost more than 0.88% in February. Top Performers in February The three best-performing managed futures mutual funds in February were: The PIMCO TRENDS fund was the category’s top performer in February, gaining an impressive 6.34%. Unfortunately, the fund – which debuted on the last day of 2013 – was still down for the year ending February 29, with one-year returns of -2.93% ranking it in the bottom 37% of its category. The fund’s one-year beta, relative to the Credit Suisse Managed Futures Liquid Index, of 0.60 was roughly in line with the category average of 0.66, while its one-year alpha of -4.27% compared unfavorably with the category average of -2.60%. PQTAX’s one-year Sharpe ratio through February 29 was -0.23, compared to -0.01 for the category as a whole. The SFG Futures Strategy Fund ranked second among managed futures mutual funds and ETFs in terms of February performance, with monthly gains of 3.92%. But like the PIMCO TRENDS fund, SFG’s Futures Strategy underperformed for the year ending February 29, returning -3.93% and ranking in the bottom third of the category. Its one-year beta and alpha stood at 0.75 and -6.38%, respectively, giving it a Sharpe ratio of -0.37. Of February’s top-three performers, the Altegris Managed Futures Strategy looked best beyond the past month’s performance. Its February gains of 3.67% contributed to its one-year return of +4.75% through February 29, ranking in the top 20% of the category. The fund, which debuted in August 2010, had three-year annualized returns of +3.71%. Its one-year beta of 0.81 indicates a relatively high correlation with the Credit Suisse index, but its alpha of 2.21% and Sharpe ratio of 0.48 highlight its outperformance. Worst Performers in February The three worst-performing managed futures mutual funds in February were: Dunham’s Alternative Strategy Fund was February’s worst performer in the managed futures category, returning a dismal -3.25%. DNASX’s underperformance has been enduring, as its -11.92% one-year returns through February 29 ranked in the bottom 8% of the category. Its one-year beta of -0.20 indicates it has very low (modestly inverse) correlation to the Credit Suisse index, but this favorable feature is overshadowed by the fund’s -11.26% one-year alpha. Its one-year Sharpe ratio, a measure of risk-adjusted returns, stood at an abysmal -2.29. The First Trust Morningstar Managed Futures Strategy ETF was the only exchange-traded fund among the top or bottom three for February. It returned -1.22% for February and -3.97% for the year ending February 29. The fund had a beta of 0.39, alpha of -4.64%, and a one-year Sharpe ratio of -0.61. Finally, the Discretionary Managed Futures Strategy Fund was February’s third-worst performer in the category, returning -0.88% for the month. The fund’s one-year return of -1.90% ranked in the bottom 46% of funds in its category, and its beta of 0.03 ranked among the lowest in the category. The fund’s one-year alpha was -2.09%, indicating that it underperformed the index even as it remained mostly uncorrelated with it. In risk-adjusted terms, FUTEX’s returns resulted in a one-year Sharpe ratio of -1.09. Note : Alpha and Beta statistics are relative to the Credit Suisse Managed Futures Liquid Index. Past performance does not necessarily predict future results. The Jason Seagraves contributed to this article.

Strategic Asset Management Launches New Global Long/Short Fund

The long/short “hedged” fund was pioneered in the late 1940s in response to the economic tumult of the prior two decades. The idea behind it was to reduce exposure to the fluctuations of the “market” by partially offsetting long positions with short ones. If the stock picker was good, this meant the fund could outperform during bull and bear markets, and the downside during the latter would be mitigated. Strategic Asset Management’s First Fund Global long/short equity funds take things a step further than Alfred Jones, “hedged” fund originator, was able to take them in 1949, when investors were largely constrained by national borders. Rather than limiting themselves to U.S. equities, global long/short equity funds are open to investments from all over the world, and the Strategic Global Long/Short Fund (MUTF: SGFAX ), just launched on February 23, employs this strategy with a split “value/growth” approach. The new fund is advised by Strategic Asset Management, Ltd., a Cayman Islands corporation, and its portfolio manager is Mauricio Alvarez, Chief Executive Officer of the Adviser. This appears to be the company’s first U.S. mutual fund. The fund’s investment objective is twofold: First, to provide attractive returns through a combination of long-term capital appreciation and current income. Secondarily, to preserve capital in down markets. In pursuit of these objectives, the fund takes long and short positions in U.S. and foreign equities across all capitalization levels, with at least 40% of assets invested in companies generating a majority of their revenue outside the U.S. Global Long/Short Exposure The fund’s long exposure is expected to range from 100% to 140%, with the use of leverage; while its short exposure is expected to range from 0% to 40%. This will leave the fund with a relatively high beta compared to other long/short equity funds. The average beta, relative to the S&P 500 Index, for funds with a track record of 3-years or more is 0.53. On the long side, a “top-down” security selection process is used to identify undervalued equities and/or equities with favorable growth characteristics. On the short side, the fund focuses more keenly on firms with deteriorating growth. Currently, the fund is available in A-class shares only, which have a 1.97% net-expense ratio and a $1,000 initial minimum investment. The prospectus also refers to C-class shares, but doesn’t list a ticker symbol. Their intended net-expense ratio is 2.72%, and they have the same $1,000 initial minimum. For more information, view the fund’s prospectus .