Sunday, 7 February 2016
Last updated 2 days ago
May 13 2010 | 3:28am ET
A new event-driven hedge fund is aiming to shine a light on value stocks.
Spotlight Funds Management launched its maiden hedge fund, Catalyst, last month with $5 million. The new long/short vehicle seeks out value stocks “with catalysts at a discount to intrinsic value,” firm co-founder Terry Lally told HFMWeek.
“It is a stockpicker’s market in 2010 which fits our track record of finding neglected companies with catalysts at a discount to intrinsic value,” he said.
The California based-fund was set up by Lally, formerly of Cramer Rosenthal McGlynn, and Stephen Riccio, founder of Buyside Custom Research & Consulting and a former Bear Stearns Asset Management portfolio manager. It also features analysts David Landry and Michael Wright.
The Catalyst fund’s portfolio includes between 20 and 30 core long names and a roughly equal number of small- and mid-cap shorts. The vehicle has a capacity of $500 million.
Catalyst charges 1.5% for management and 20% for performance. There is a $100,000 minimum investment requirement for individual investors and a $1 million minimum for institutions. The fund features monthly liquidity.
Jefferies & Co. is the firm’s prime broker.