Rialto Capital Readies Second Fund

Apr 16 2012 | 8:55am ET

Zurich-based Rialto Capital has added former Standard Chartered Bank commodities trader Giacomo Berta as a portfolio manager and head of quantitative research as it readies its second investment vehicle, Rialto Systematic.

Rialto, founded by Man Investments alumnus Gerard Sanz in 2011, now runs the Rialto Global Macro Fund, which is up 10% since its inception in Q3 2011. The  fund invests in liquid futures, with 50% of its assets in equities and equal amounts in bonds, currencies and commodities. It employs chiefly relative value arbitrage strategies with a constant risk management/hedging overlay.

The global macro strategy’s best month was January 2012, when it was up 4.97% while its worst was the very next, February 2012, which saw it down 1.64%. (In a letter to investors, Rialto explained the negative February results by saying its views were “broadly correct” but its timing was “poor,” as it scaled back its equity risk exposure after a strong January.)

Rialto Systematic, scheduled for launch in Q3 2012, will invest through a variety of quantitative strategies in global futures (commodities, FX, FI, stock indices) and global equities, with a high to medium/low frequency.

Sanz told FINalternatives in an e-mail that, in their opinion, there will be “further volatility in all asset classes” and a “simple ‘buy and hold’ strategy will come at too high a price for private as well as institutional investors.

“We view the global macro space and CTA strategies as very well positioned to take advantage of the opportunities that will surface in the next months and years. Our global macro strategy looks back at a solid double-digit return over the last eight months, showing half the volatility delivered by equities during the same period. We will pursue our rigor and focus on risk management and expect similar success for our quantitative and systematic strategy which we will be launching in Q3 2012.”

 


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