A hedge fund just launched by systematic global macro specialist Cantab Capital Partners LLP has a refreshing feature: It's cheap!
The company hard-closed its flagship CCP Quantitative Fund at $4.7 billion to preserve alpha generation, said Ewan Kirk, CEO, chief investment officer and founding partner.
Cantab Capital Partners' global macro strategy relies on three sources of return: short-term, medium-term and value-oriented trading strategies. The capacity constraint in the original strategy comes from the use of shorter-term trading strategies that make it difficult to efficiently trade large amounts of money, Mr. Kirk said.
The CCP Core Macro Fund, which opened to outside investors last month, doesn't invest in short-term trades and, by focusing on the two longer-term trading strategies, the new fund is scalable to “the tens of billions,” Mr. Kirk said.
The core fund is designed for institutional investors offering daily liquidity, target volatility of 10%, and a 0.5% annual management fee and 10% performance fee, compared with the industry standard 2%-and-20% fee for the first CCP fund. Because Cambridge, England-based Cantab Capital Partners uses the same risk management, trading and back-office systems for the new fund, there was “zero incremental cost,” Mr. Kirk said.
“It's a little bit of a disruptive product,” Mr. Kirk acknowledged.