Equinox Launches Long/Short Commodity Mutual Fund

Jul 6 2011 | 2:06pm ET

Equinox Fund Management, a sponsor of alternative investment vehicles, has launched a mutual fund with an alternative twist.

The Equinox Commodity Strategy employs a long-short commodity trading strategy to exploit potential inefficiencies in the systematic selling and repurchasing of expiring futures contracts.

Portfolio manager Ajay Dravid aims to exploit contango roll without directional exposure to commodity prices.

The fund offers investors an opportunity to diversify their current holdings in long-only commodity funds and ETFs, avoiding what Equinox characterizes as three challenges common to both ETFs and long-only funds. That is, high volatility, increasing correlation to other asset classes and systematic negative roll yields in commodity markets with rising price curves (i.e. “contango”).

Said Robert Enck, president and CEO of Equinox: “At Equinox, we keenly appreciate both the opportunities and challenges of investing in commodities.  We have created the Equinox Commodity Strategy Fund as a means to address critical issues of volatility, correlation, and index integrity, while providing investors with an investment that draws upon our knowledge and experience in the commodity markets.”

Rich Bornhoft, Equinox CIO, said the fund employs a market neutral strategy that is equally long and short each commodity. “It uses a targeting mechanism to dampen volatility, the goal of which is a standard deviation of 6% or less.”

Dravid has more than 25 years of experience in industry, academia, and financial services. Prior to joining Equinox, Dravid was an adjunct professor of finance at Temple University’s Fox School of Business. His career has included stints at Solon Capital, The Frontier Fund, Saranac Capital Management, Salomon Brothers and Citigroup.


In Depth

Q&A: TCA Fund Management's Bob Press on Small-Cap Private Equity

Aug 25 2016 | 8:55pm ET

The emergence of private credit as a replacement for traditional bank financing...

Lifestyle

Kiawah: Island Reversal

Aug 24 2016 | 9:59pm ET

Looking for real estate investments but the typical real estate fare isn’t cutting...

Guest Contributor

Old Hill Partners: Embrace Illiquidity

Aug 9 2016 | 2:39pm ET

The age-old financial concept that higher yields are the result of higher risk and...