London-based AltEdge Capital Management has added a pair of funds of hedge funds to its stable of products. The firm in March launched a commodity trading adviser fund followed by a distressed fund in May. 

The US $23 million CTA portfolio currently invests in 13 underlying managers, while the $22 million distressed portfolio invests in 12. 

According to Brendan Campbell, AltEdge’s vice president Hedge Fund Research, combining the two portfolios can result in a two-fold benefit for investors: distressed hedge funds contribute high risk-adjusted returns and are a direct beneficiary of an economic downturn, while CTAs provide a degree of protection against weak equity markets that typically proceed the best part of the distressed cycle.

“By combining these two strategies, it is possible to create a portfolio which can exploit the huge existing distressed investing opportunity set while maintaining a high level of return across the economic cycle, thereby removing the need to try to attempt to market time the distressed cycle,” he said.

The CTA portfolio’s USD share class gained an estimated 1.6% in its first three months of trading and the distressed portfolio was up 0.91%.

AltEdge Capital was founded in 2001 by Chris Goekjian, former global head of fixed income and derivatives at Credit Suisse First Boston.