New York Hedge Fund Bets On Crises

Nov 30 2007 | 9:48am ET

One New York-based hedge fund is betting on continuing crises across asset classes and is looking to offer investors, specifically funds of hedge funds, hedging overlays on their portfolios.

New York-based Penso Capital Markets is prepping the Crisis Fund for launch sometime in the first quarter. The new offering will manage a portfolio of investments across equity, fixed-income, commodity and foreign-exchange markets. As its name implies, the fund expects its best returns to come in market crisis scenarios, with lower and possibly negative returns in benign and bullish times, according to fund documents.

Co-portfolio manager Steve Gross said the fund is an extension of what the firm has been doing in managed accounts for its existing clients. “We wanted to create this vehicle for groups not large enough for managed accounts or are trying to make a bet on what will happen in the world,” he said. “We try to identify what the risks are in the coming periods and we look for specific ways we can hedge those risks or profit from those events.” 

The new fund will be added to the firm’s Select Opportunities platform, a collection of macro event-driven strategies, as a new share class. Gross expects to see more opportunities in the foreign exchange space as volatility rises for the dollar in the next 12 to 18 months as well as in the real estate market and corporate credit.

“If we do go into a recession next year, which is looking more likely, there will be an increase in corporate credit defaults.”

The Crisis Fund, which  Gross co-manages with Penso’s managing principal, Ari Bergmann, charges a 2% management and 15% performance fee with a high-water mark and a one-year lockup period.

The firm manages $200 million in funds of funds, in addition to monies it manages in seperate accounts.


In Depth

High Time For A Cannabis Hedge Fund?

Sep 30 2014 | 7:07am ET

Launching a hedge fund is always a gamble, but Leslie Bocskor's decision to launch...

Lifestyle

Griffin Donates $1M To Rauner's Illinois Gov. Campaign

Sep 22 2014 | 9:29am ET

Hedge fund billionaire Kenneth Griffin definitely has a dog in this fight. The Citadel...

Guest Contributor

Appraisal Ratio Key To Evaluating Hedge Funds And Other New Investments

Sep 29 2014 | 3:07pm ET

As a former finance professor Peter Hecht experiences heartburn every time he hears...

 

Videos

Editor's Note

    Must Attend Hedge Fund Charity Events For October

    Sep 30 2014 | 9:29am ET

    The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…

 

Futures Magazine

September 2014 Cover

High frequency market making

High frequency trading is not evil, it is not a conspiracy and it really is not new; it is the natural evolution of the professional trading community making markets, providing liquidity and hopefully...

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.