Our Client Selection Process

We select our clients. We are highly selective in choosing a hedge fund or alternatives fund to represent. Our due diligence process refines the broad universe of hedge fund and alternatives managers to funds we agree to represent. We select the highest quality funds with clearly defined investment processes and risk controls, experienced investment teams and strong historical performance featuring low-correlated, low-volatility absolute returns with a capital preservation priority. Ultimately, our reputation is based on the quality of the funds we choose to represent.

 

We provide exclusivity by limiting our hedge fund clients to one per hedge fund strategy. Similarly, our selected alternatives funds strategies are limited for exclusivity. This strategy exclusivity may be limited by geographic and sector specializations. 

 

As participants in the Canadian institutional alternative investments market, we stay current with the hedge fund and alternatives strategies in demand in the Canadian market as well as the mandates presently under consideration by specific Canadian institutional investors. Comprehensive, in-depth market intelligence is our strength in the Canadian institutional investor market for alternative investments. 

 

Using leading institutional hedge fund databases, we determine the peer group of hedge funds employing the alternative investment strategies in demand today. Then we apply both quantitative and qualitative screens to this peer group in selecting a hedge fund to represent across Canada.

 

 

OUR SERVICES

Quantitative Screening 

 

Our data analytics and performance quantitative screens include:

 

  • AUM (>$1B)

  • longevity (>5yrs.)

  • performance since inception by month and year (relative to S&P/TSX and S&P500)

  • source of returns: performance attribution by sector

  • monthly alpha (relative to S&P/TSX and S&P500)

  • annualized alpha (relative to S&P/TSX and S&P500)

  • beta (relative to S&P/TSX and S&P500)

  • correlation (relative to S&P/TSX and S&P500)

  • standard deviation (relative to S&P/TSX and S&P500)

  • Sharpe Ratio & Sortino Ratio (S&P/TSX TRI and S&P500)

  • Drawdowns: cause & recovery

 

Our peer analysis quantitative screens include:

 

  • Peer Quartile Rankings 

  • Peer Risk:Return Scatter Graphs 

 

Qualitative Screening

 

Our qualitative screens include:

 

  • Portfolio Manager pedigree

  • Transparency

  • Managed Account availability

  • Capacity constraints

  • Institutional-grade risk management system including:

    • maximum limits on leverage 

    • maximum limits on concentration

    • liquidity limiting provisions

    • quantitative risk controls

  • Quality of service providers:

    • Prime Broker

    • Auditors 

    • Lawyers

    • Trustee/Custodian/Administrator

  • Operational infrastructure: management, compliance & back-office

  • Investor relations: reporting and ongoing client service

  • Firm ownership

  • Fund co-investment by firm members

 

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