Tuesday, 22 July 2014
Last updated 1 hour ago
Aug 11 2006 | 12:00am ET
ChipInvestors Group is readying to launch a long/short hedge fund that will invest exclusively in semi-conductor companies. “We believe that we are one of the very few, if not the only, investment funds that is structured like a hedge fund and is focused 100% on the semiconductor space,” said Manoj Nadkarni, founder and portfolio manager of the Washington State-based firm.
The fund, ChipInvestor Partners L.P., is set to launch Sept. 1. Nadkarni explained that the firm’s investment approach is twofold. First, it will take a macro-approach to analyzing the industry and where it is in its cycle of growth, and second, it will take a bottom-up approach, evaluating the fundamentals of each company in which the fund invests.
“Semiconductor companies are enablers of technology, they drive the whole technology sector,” said Nadkarni, who, before forming a Registered Investment Advisor earlier this year ran a research publishing firm from 1999 to 2005 that focused on the semiconductor space. Prior to that, the MIT-educated engineer worked in the semiconductor industry for over 12 years. Nadkarni believe that his long-history and inside knowledge of the industry will give him and his firm an edge when it comes to evaluating investments.
The minimum investment in the new fund is $1 million for institutions and $250,000 for high-net-worth individuals. The lockup period is three years. Nadkarni decided upon a three-year lockup because the industry is cyclical and he does not want investors to flee at the first sign of trouble in the sector.
“The first time we have a panic, we would get notices of redemption, so it is in the best interest of the limited partners to have a 3-year minimum lockup,” he said.
Fidelity Investments is serving as the prime broker for the new fund. Holland & Knight is providing counsel. The auditor is Harb Levy and the administrator is NAV Consulting.
“This fund is well suited for any investor who wants to put a small portion with a sector specialist,” said Nadkarni.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…