Spinner Asset Management will open its second long/short equity hedge fund, Clover Street Fund, to outside investors on March 1, Thomas Anderson, director of sales and marketing, said in an interview.
David Reale, partner and portfolio manager, has managed the Clover Street Fund with about $25 million in seed money since January 2009 using a low-volatility, value-oriented strategy.
“In a growth industry like technology, you never see value approaches, but it's something that our clients are interested in,” Mr. Anderson said.
Mr. Reale's portfolio is concentrated, investing on the long side in 20 to 25 technology companies and going short on same number of tech firms. The fund's target annual return is 13% to 15% with volatility of 6% to 7% across a full business cycle, Mr. Anderson said.
On a net-of-fees basis, the Clover Street Fund returned 7.1% in 2011 with volatility of 6.9%. Of the 11% gross return in 2011, 8% of the return resulted from Mr. Reale's short bets.
Spinner Asset Management manages an additional $375 million in its 18-year old flagship long/short equity hedge fund, Spinner Global Technology Fund, which is less concentrated and generally is longer biased, Mr. Anderson said. About 80% of Spinner's total assets of $400 million are managed for institutional investors.