Welton Triples AUM This Year, Expands Distribution

Nov 8 2006 | 10:28am ET

Alternative asset manager Welton Investment Corporation has more than tripled its assets under management since the beginning of the year, and is now partnering with distribution firms in order to expand into new markets. The Carmel, Calif.-based firm, which specializes in managed futures, has just signed an agreement with Graf von Bismarck & Associates to bring Welton’s products to the German marketplace.

“This happens to be one of a couple irons we have in the fire,” says Christopher Keenan, head of marketing, adding that the 14-member firm is “staffed to accommodate growth,” and is actively working on expanding distribution relationships globally.

Welton currently has $192 million in assets under management, up from $63 million at the beginning of the year. The majority of these assets are in the firm’s Global Directional Program (GDP), which crossed the 24-month mark in May. Keenan attributes the increased interest in the program, specifically from institutions, not only to having a two-year track record, but to the portfolio managers’ quantitative analysis and their rigid belief in process-driven management.

Keenan explains that the program was born out of a desire to preserve the well-known virtues of directional managed futures. “If you study composite returns, [the argument] is extremely compelling,” he says. “You find a non-correlation to other asset classes, particularly equities, and yet you find comparable return magnitude with similar volatility.”

He explains that the Global Directional Program was built from the ground up to be composite-like in terms of its return character, but that it shouldn’t be confused with an index product.

"It was equally important to us that GDP be a top-tier single manager program, and so although its return characteristics are similar to [the S&P Manage Futures Index], we have also steadily outperformed it by over 43% to-date,” he says.

Thus far the Global Directional Fund is up 40.33% since its inception in July 2004 through this October, while the S&P Managed Futures Index is down 2.91% over the same period. 

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