CEC Preps Market Neutral Strategy, Halts Ocean Program

Oct 18 2007 | 12:50pm ET

CEC Capital has a new Goal in mind.

The Stuart, Fla.-based commodity trading advisor is gearing up to launch a market neutral strategy with the help of an industry veteran after putting the brakes on its two-and-a-half year old Ocean program.

CEC’s managing director Clark Collins has been prepping the latest offering, tentatively named the Goal program, with fellow CTA Pierre Tullier, the former president of Dunn Capital Management.

“The strategy is similar to pairs trading and we’re trading the largest of the S&P 500 stocks,” said Collins. “It’s a mathematical system looking at the nine different sectors that make up the S&P. Each sector is isolated as far as the analysis goes in measuring the stocks in terms of being under or overvalued. We use correlations and coefficients to help us with weighting different positions. I don’t think people have addressed market neutral in this fashion.” 

The new strategy, which already has attracted between $5 million and $20 million in commitments, is slated to launch in January and Collins aims to raise $100 million within the first year.

“We really think we can raise quite a bit of money from pensions and other investors looking for a market neutral product in a highly volatile environment,” he said.

Meanwhile, Collins said the firm stopped trading its Ocean program, a systematic diversified futures strategy, in April because it wanted to make the program fully automated.

“It was just overwhelming taking care of the Ocean program so we made a decision six months ago to stop trading it until we can implement fully automated strategies,” he said. “Currently, we have to place the orders verbally so we’re doing additional research on the program and we want to get to get it to a point where the computer is running it 100%.”

Collins, who anticipates trading the program again sometime within the next few months, said Ocean investors were diverted into the firm’s Tradewinds Global Fund, a multi-strategy fund of funds that invests in long/short equity, fixed income, foreign exchange, managed futures, and convertible arbitrage managers. The Ocean program managed $12 million at its peak in 2006 and returned –6.6% last year.

Before founding CEC Capital in 1999, Collins co-founded TJM Capital Partners and served as a portfolio manager for the firm’s multi-strategy fund of funds.


In Depth

Q&A: Neil Azous Talks Global Macro Investing

Nov 24 2014 | 12:41pm ET

Neil Azous is the founder and managing member of Rareview Macro, an advisory firm...

Lifestyle

Griffin Selling Chicago Apartment

Nov 26 2014 | 11:40am ET

Citadel Investment Group’s Kenneth Griffin is making clear to his estranged wife...

Guest Contributor

Why The Big Money Is Going To Europe

Nov 14 2014 | 6:03am ET

Peer-to-peer lending was invented with the individual investor in mind. But despite...

 

Sponsored Content

    For Hedge Funds, Mastering Data Is Key To Success

    Nov 4 2014 | 9:45am ET

    Data management is important to every business, but for hedge funds, it is critical. FINalternatives recently asked Peter Sanchez, CEO of Northern Trust Hedge Fund Services, how fund managers can deal with the demands of managing data while at the same time remain transparent and abide by operational best practices. Read more…

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

November 2014 Cover

Building a better market

Reg NMS created a huge bifurcation in equity markets and while much of what has followed has been positive, in terms of lower fees and greater liquidity, many traders would like to see the market come...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.