STAMFORD, Conn. - Ed Barksdale, a pioneer in the pension consulting and manager-of-managers fields, retired from Northern Trust Jan. 1 last year, but he wasn't able to stay retired.
He has launched another manager-of-managers firm focused on hedge funds. The new firm, Federal Street Partners, Stamford, is aimed at pension funds, foundations, endowments and family offices.
Mr. Barksdale was a consultant with Callan Associates in the early 1970s and was one of the founders of Rogers, Casey & Barksdale Inc. (now Barra RogersCasey) in 1976.
There he began a manager-of-managers fund for Canadian pension funds in 1979. In 1987, he and his partners separated from Rogers, Casey and formed RCB International, managing several manager-of-manager portfolios for U.S., Canadian and U.K. pension funds.
RCB International was acquired by Northern Trust in 1995, when it had $5.5 billion under management. That grew to $15 billion by Dec. 31, 2000.
Mr. Barksdale and his partners in the new venture, Will Green, Gene Markowski and Theresa Miller, had begun a small "friends and family" manager-of-managers effort in 1993.
This invested in "more off-the-wall" kinds of situations, including some manager startups, and was not part of the Northern Trust acquisition. The first hedge fund investment they made was in the fund started by former Fidelity Magellan fund manager Jeffrey Vinik in 1996.
They have now focused the manager-of-managers fund on hedge funds, and have decided to build it into a business.
For Mr. Barksdale, it's a return to his roots because Rogers, Casey & Associates made its name in the early 1980s identifying emerging managers, and his new company seeks to identify promising new hedge funds.
"The problem with hedge funds today is they fill up very quickly," Mr. Barksdale said. "If you wait five years for a track record, you aren't going to get in. Vinik went from taking money to giving it back in just five years."
Federal Street Partners, which has $40 million under management at present, plans to have some diversification by style, but will emphasize styles that offer the best risk/reward opportunities, including long-short and European arbitrage.
The partners hope to capture 100% of performance in up markets, and only 25% of the losses in down markets.
