Two firms have joined forces to launch a new hedge fund that seeks to do well by doing good.
The Do The Right Thing fund will invest in companies and market sectors dealing with hunger, thirst and disease, as well as in clean energy, HFMWeek reports. In addition, the fund, which will have long fixed-income, options selling and position trading portfolios, will also donate part of its fees to charity.
The fund is the brainchild of California-based Herron Capital Management and Britain's Interbank Trading Technologies. It will launch within the next two to three months.
"We believe that investors can dictate the tempo of providing real solutions for our world's problems by investing in new technologies designed to move humanity forward," portfolio manager Michael Herron told HFM.
In addition to any returns, investors will get to choose which charities get a piece of the fund's fees—and a tax deduction, to boot. The fund offers a capital guarantee and minimum rate of return.
Do The Right Thing has a $25,000 minimum investment requirement and $2 billion capacity, with a five-year lockup for investors who choose the capital guarantee and no lockup for those who forego it. It will charge 1.5% for management and 25% for performance.