Princeton Takes Stake In Fund Of Funds, Preps Credit Hedge Fund

Oct 17 2007 | 10:44am ET

Fixed income specialist Princeton Alternative Investment is looking to give its investor base broader exposure to hedge funds with its latest deal. 

The Princeton, N.J.-based firm has taken a minority stake in fund of hedge funds operator NewMarket Capital Partners. Both firms will remain independent entities. Terms of the transaction were not disclosed.

Patricia Young, one of three NewMarket co-founders, said both firms came together to accelerate their collective strategic plans and create a full-service investment platform.

“From both sides investors were saying, ‘Show me more’ and we saw this as a great way of accelerating that,” said Young, whose firm currently manages a diversified fund of hedge funds. “Princeton currently manages a series of structured products and their next evolution is to offer direct hedge funds.”

The Princeton Credit Opportunities Fund, an extension of a strategy that Princeton currently manages under its structured products portfolio, will launch sometime in the fourth quarter. Paul Malecki, a senior portfolio manager responsible for bank loan debt, will manage the fund.

For its part, Young said NewMarket will be looking to add Princetion investors who are “very interested” in funds of funds to its investor base, adding, “as market opportunities arise we’ll look to be launching specific strategy funds of funds.”

NewMarket was founded in 2003 by Young, Diana Wagner and Mindy Posoff. Princeton currently manages in excess of $13 billion in asset-backed securities, mortgage backed securities and leveraged loans.

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