CTA specialist RPM and asset manager Privium Fund Management are launching a Netherlands-based fund of “evolving” CTAs.
The Evolving CTA Fund will feature a portfolio of “smaller and innovative CTA managers” across three sub strategies: trend-following, short-term and fundamental. The CTAs will typically be between two and seven years of age with $30 million to $2 billion in assets under management.
“Today's large and well-known CTAs were unknown to most investors when their performance was at its most competitive,” said Clayton Heijman of Privium, which will manage the fund, in a statement. “The 'Evolving CTAs have demonstrated a unique expertise and ability to generate returns, in many cases with new, innovative ideas and methods.
"An asset manager develops like most other companies: a start-up phase followed by a growth phase with strong competitiveness. As they move into maturity, their competitive edge gradually deteriorates. A few have the ability to renew themselves, others fade away. Unfortunately, most investors are attracted to them at the peak in their life cycle. This fund focuses on managers that have entered into the growth or 'evolving' phase.”
RPM Risk & Portfolio Management, with roughly $4 billion under management and advisory, said its research has shown such CTAs have historically outperformed their larger peers by 3% annually.
The fund will be benchmarked against the Barclay BTOP50 index, which tracks 20 of the largest and best known CTAs. The fund will be domiciled in The Netherlands and will invest in the Luxembourg-based RPM Evolving CTA Fund (SICAV), offering daily liquidity and a minimum subscription of €25,000.