25th September 2017
OPTIMA OFFERS COST-EFFICIENT,
LIQUID ACCESS TO TOP US EQUITY
HEDGE FUND MANAGERS
The
Optima Selective Trading & Active Reporting (“STAR”) Long Strategy
New
York and London. Optima Fund Management,
one of the pre-eminent fund of hedge funds and hedge fund allocation firms, is
making available its Optima STAR Long Strategy in Europe. STAR Long Strategy offers investors the
opportunity to benefit from the highest-conviction stock positions held by Optima’s
pick of leading American hedge funds without facing the high-charges and low
liquidity that direct participation in such funds inevitably involves.
Focusing
on managers working with US equities and American Depositary Receipts (ADRs),
Optima has matched its own long experience in investing with the top managers
with a lateral approach to the interpretation of US investment regulations
specifically those rules which require equity managers publicly to file reports
of their principal equity holdings on a quarterly basis. This regulatory disclosure shines a light on
a manager’s portfolio and in so doing, has created the opportunity for the
development of the STAR Long Strategy.
“What
is the Holy Grail for hedge fund investors?” enquires Dixon Boardman, Founder
and Managing Partner of Optima Fund Management.
“The goal is to identify managers who first have demonstrated a real
edge in managing money, and second, have generated superior performance. But investors have chafed increasingly at the
high fees, lack of liquidity, limited transparency, prohibitively high minimum
investments, and downright user unfriendliness of hedge funds.
“With
the launch of the STAR Long Strategy, the Optima Group has addressed these
issues.” Mr Boardman continues. “STAR
Long Strategy’s portfolio consists of what Optima views as the five highest
conviction holdings of ten hand-picked top-performing hedge fund managers. But – and this is a big but – STAR Long
Strategy does so while offering daily liquidity and sensible flat management
fees.”
In
simple terms, the STAR Long Strategy combines what we feel are two powerful
investment principles. First that
long-term success is most likely to come from allocating to the “best and
brightest” money managers you can find, and second in our experience these top
managers tend to outperform when they concentrate on their highest conviction
stock ideas. As Warren Buffet once put
it, “Diversification may preserve wealth, but concentration builds wealth.”
The
STAR Long Strategy portfolio is constructed by following a three-step
process. First, Optima screens it
universe of hedge funds to identify what it views as the 10 most attractive,
based on quantitative measures of performance, volatility of returns,
correlation and so on, as well as qualitative assessments of each manager. Next Optima selects the top five positions by
market value from each of the identified managers, using public filings. Finally, risk guidelines are applied to manage
liquidity and sector concentrations.
The
result is a portfolio of 50 of our “highest conviction” equities from hedge fund managers who we believe to be the 10
“best in class” hedge fund managers. The
10 managers follow different but complementary investment approaches including
value, opportunistic, growth and event-driven – the balance between these
approaches may vary from time to time.
The
STAR Long Strategy was launched in the second quarter of 2016 so European
investors, to whom the Strategy is being offered, have the benefit of more than
12 months’ trading experience.
OPTIMA FUND MANAGEMENT
Optima
Fund Management was founded in 1988 by Dixon Boardman, who still runs the firm
today. An SEC registered investment
adviser headquartered in New York City, the firm has $2.2 billion in assets
under management and is well-recognized in the investment industry for its
accomplishments. Most recently, the firm
was an A1 hedge fund awards winner as a leader in multi-manager hedge fund
programs and for the best international equity fund over three years for one of
its commingled investment vehicles.