Hedgeweek Global Awards 2018 CONTENTS

March 2018

In this issue…

03 Hedgeweek Global Awards 28 ML Capital 2018 results Best UCITS Liquid Alternatives Fund & Best UCITS Liquid Alternatives Platform 04 Hedge fund industry alive & kicking 30 Iron Cove Partners By James Williams Best Global Insurance Provider

06 Sabre Fund Management 32 Optima Fund Management Best Statistical Arbitrage Hedge Fund Best Multi-Strategy Fund of Hedge Funds

08 EisnerAmper LLP 34 HedgeMark Best Global Accounting Firm Best Managed Accounts Platform

10 DMS Governance 36 Pillar Capital Management Best Offshore Regulatory Advisory Firm Best Insurance-Linked Strategies Hedge 11 JonesTrading Fund Best Outsourced Trading Provider 38 SS&C GlobeOp 13 JP Fund Administration Best Global Hedge Fund Administrator Best Offshore Hedge Fund Administrator 39 Agecroft Partners 16 Hathersage Capital Best Global Third Party Marketing Firm AWARDS 2018 Management 41 Invast Global Best Foreign Exchange Hedge Fund Best Specialist Market Prime Broker 18 Cowen Prime Services 43 Align Best Global Prime Broker Best Global Cloud Services Provider 20 Derivitec Ltd 44 Fair Oaks Capital Best Risk Management Software Firm Best Fixed Income Credit Strategy Hedge 22 UMB Fund Services Fund Best Liquid Alternatives ’40 Act Fund Administrator

23 Harneys Best Offshore Law Firm

26 Altana Wealth Best Niche Hedge Fund

Publisher

Managing Editor: James Williams, [email protected]; Managing Editor (Wealth Adviser, etfexpress & AlphaQ): Beverly Chandler, [email protected]; Online News Editor: Mark Kitchen, [email protected]; Deputy Online News Editor: Mary Gopalan, [email protected]; Graphic Design: Siobhan Brownlow, [email protected]; Sales Managers: Simon Broch, [email protected]; Malcolm Dunn, [email protected]; Sales Manager, Property Funds World: Matthew White, [email protected]; Marketing Administrator: Marion Fullerton, [email protected]; Head of Events: Katie Gopal, [email protected]; Chief Operating Officer: Oliver Bradley, [email protected]; Chairman & Publisher: Sunil Gopalan, [email protected]; Photographs: Chris Mikami, www.mikami.co.uk Published by: GFM Ltd, Floor One, Liberation Station, St Helier, Jersey JE2 3AS, Channel Islands Tel: +44 (0)1534 719780 Website: www.globalfundmedia.com ©Copyright 2018 GFM Ltd. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher. Investment Warning: The information provided in this publication should not form the sole basis of any investment decision. No investment decision should be made in relation to any of the information provided other than on the advice of a professional financial advisor. Past performance is no guarantee of future results. The value and income derived from investments can go down as well as up.

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 2 HEDGEWEEK GLOBAL AWARDS 2018 The winners AWARDS 2018

Best Macro Hedge Fund Best Managed Accounts Platform Haidar Capital Management HedgeMark Best Foreign Exchange Hedge Fund Best Seeding Platform Hathersage Capital Management LLC Tages Capital LLP Best Commodities Hedge Fund Best Risk Management Software Northlander Commodity Advisors LLP Firm Derivitec Ltd Best Insurance-Linked Strategies Hedge Fund Best Fund Accounting and Pillar Capital Management Ltd Reporting Systems Firm FundCount LLC Best Niche Hedge Fund Altana Wealth Best Global Trading Venue Eurex Best Multi-Strategy Fund of Best Long/Short Equity Strategy Hedge Funds Best Global Accounting Firm Hedge Fund Optima Fund Management EisnerAmper LLP Quadra Capital Partners Best Systematic CTAs Best Global Shadow Accounting Best Long Bias Strategy Hedge Steppenwolf Capital Firm Fund Viteos Best UCITS Liquid Alternatives Slater Investments Ltd Fund Best Global Regulatory Advisory Best Value Orientated Strategy ML Capital Firm Hedge Fund Cordium Best UCITS Liquid Alternatives Cobia Capital Platform Best Offshore Regulatory Advisory Best Long/Short Credit Strategy ML Capital Firm Hedge Fund DMS Governance Best Event Driven Fund LMCG Investments Sound Point Capital Management LP Best Global Cyber-Security Best Fixed Income Credit Strategy Services Provider Best Global Index Provider Hedge Fund Duff & Phelps Fair Oaks Capital FTSE Russell Best Global Cloud Services Provider Best Global Hedge Fund Best Mortgage Backed Securities Align Strategies Hedge Fund Administrator Best Global Public Relations Firm East Lodge Capital SS&C GlobeOp CitySavvy Best Specialist Credit Strategy Best Offshore Hedge Fund Hedge Fund Administrator Best Global Data Visualisation Software Provider Hildene Capital Management JP Fund Administration Broadridge Financial Solutions Best Equity Market Neutral Best Liquid Alternatives ’40 Act Hedge Fund Fund Administrator Best Global Consultant in Business Strategy Gondor Capital Management LLP UMB Fund Services Draycliffe Best Fixed Income Arbitrage Best Global Prime Broker Hedge Fund Cowen Prime Services LLC Best Global Insurance Provider Iron Cove Partners Danske Bank Asset Management Best Specialist Market Prime Best Statistical Arbitrage Hedge Broker Best Global Law Firm Fund Invast Global Seward & Kissel LLP Sabre Fund Management Best Outsourced Trading Provider Best Offshore Law Firm Best Convertible Arbitrage Hedge JonesTrading Harneys Fund Best Global Hedge Fund research Best Global Third Party Marketing Blue Diamond Asset Management Provider Firm Wedbush Agecroft Partners

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 3 OVERVIEW

Hedge fund industry alive & kicking By James Williams

Another year and, I’m pleased to say, another Multi-strategy funds proved to be the most fantastic Global Hedgeweek Awards event. popular, according to Preqin’s 2018 Global There was a lot to be cheerful about for this Hedge Fund Report, attracting net inflows year’s winners, who once again demonstrated of USD24.2 billion. Although this 14 per cent that creativity and innovation, not to mention increase took total AuM in this strategy a commitment to excellence, are alive and sector to USD485 billion, Macro strategies kicking in the hedge fund industry. remain the most dominant sector, with AuM More than that, the sense of optimism rising 8 per cent to USD1.054 trillion. They emanated from what was, finally, a good recorded a net increase of USD17.2 billion, year for performance. The industry returned ranking them third for the year behind Macro a healthy 11.41 per cent and attracted net and CTAs, which saw a net increase of new inflows of USD49.5 billion to take total USD22.6 billion. industry AUM to USD3.55 trillion. With increased market volatility expected

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 4 OVERVIEW

for 2018 and already signs of geopolitical already seeing continued improvement in risks such as a US-Sino trade war potentially individual stock performance with falling impacting risky assets, there should be cross-correlation and rising dispersion plenty of opportunities for active managers when looking at the constituents of the to prove their worth. Indeed, the more central S&P 500 Index. banks scale back their level of interference, Optima says that it sees powerful changes which has done nothing other than keep influencing how risk is being perceived and developed market economies on life support, how company benchmarking is evolving. the more markets will normalise and return This evolution is a welcomed change to fundamentals. from the dynamics of the past nine years Some investors such as Optima Fund where every stock was a winner just for Management, a leading New York-based showing up. FoHF, expect, at the country level, to see In contrast, the benefits that spawn from more differentiated performance as policy changing policy mandates and differentiated leaders cope with a gradually tighter supply growth patterns will likely be more unevenly of international dollars. From a bottom distributed going forward. Optima expects up perspective, investors like Optima are this to more fully reward those managers 14

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 5 SABRE FUND MANAGEMENT Sabre Fund Management Best Statistical Arbitrage Hedge Fund

Sabre Fund Management is one of London’s also the short-term trends driven by most well established hedge fund managers, investor behaviour. Whatever investment having launched its flagship market neutral style develops in the markets, the fund’s Sabre Style Arbitrage Fund in 2002 and the proprietary models can adapt accordingly. newer Dynamic Equity Strategy in 2013. The Hill explains that Sabre’s Information firm is steered by Melissa Hill, CEO, who Advantage models performed very well in joined the firm in 1996. 2017. These are proprietary models, formed Leading the investment process is Dan using a data set Sabre has been building Jelicic. Dan joined Sabre in 2002 to manage internally since 2002. the Style Arbitrage Fund and today he “Our models are weighted according to drives the investment process utilised in Melissa Hill, CEO at Sabre how they have performed in the past and Sabre’s Style strategies. Fund Management then refined with a tilt to what is being Like many statistical arbitrage funds, rewarded now. However, these Information Sabre Style Arbitrage is market agnostic. Advantage models account for a large part The Sabre Style Arbitrage Fund was of the Fund’s total return and so typically launched in August 2002. This systematic have a fairly consistent weight allocated to fund dynamically combines factor and them. Earnings Momentum and Quality also statistical arbitrage models to exploit trending did well in 2017,” says Hill. and mean reverting behaviour in stocks. The One of the main benefits available to portfolio comprises approximately 800 of the investors holding systematic market neutral most liquid stocks drawn from the FTSE250, funds in their portfolios is to improve the DJ Stoxx 600 and the S&P 500. diversification with de minimis market beta Reflecting on last year, Hill says it was an exposure i.e. to optimise their Sharpe ratio. “ideal year” for the strategy. Commenting on building the business “We saw considerable variation in style at Sabre, Hill said that in her view people behaviour throughout the year, with most do their best work in an environment that styles contributing positively and only Value is intellectually competitive but one that is underperforming. Our dynamic models are also able to nurture talented individuals. adept at capturing changing style sentiment, From a cultural perspective, Sabre has had leading to a 12 per cent return and a Sharpe success in bringing people into the firm early ratio of 2.8 for 2017,” comments Hill. in their careers and watching them grow in At the heart of the fund’s ‘style investing’ the business. philosophy is the aim to diversify risk and “We have always been very client-centric, maximise returns. Multiple style-factor offering good attribution transparency and portfolios are constructed and combined through being one of the early adopters of with technical models that reduce offering managed accounts alongside our exposure at times of factor stress. Portfolio fund range, in order to provide bespoke construction is similar to a fund of funds versions of our core strategies,” adds Hill. owing to the fact that the core style factor On winning this year’s award, Hill portfolios have a reasonably low correlation remarks: “It is a great privilege to be the with each other. guardian of the Sabre team and winning Sabre’s portfolio aims to capture the this award is wonderful recognition of the styles rewarded as a result of the long- hard work and innovation that goes into our term economic trends in markets but investment strategies.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 6 Strength In Numbers

Recognized as a Top Accounting Firm Our People audit • tax • advisory 1,500+ Years in a Row as the Leading Accounting Firm Employees (Institutional Investor’s Alpha Awards) 3 25% # Best North American Accounting Firm Dedicated to Financial Services 1 (Hedgeweek) # Best Global Accounting Firm 1 (Hedgeweek) # Best Tax Advisor 1 (Alt Credit Intelligence) # Most Innovative Advisory Firm 1 (HFM Week) # Best Advisory Firm 1 (HFM Week) # Best Tax & Audit Service 1 (CTA Intelligence)

Recognized as a global leader to the financial services industry

2,500+ 10,000+ Financial Services industry clients Transactions 1,350+ >10% Hedge Funds Providing services to more than 10% of the top 100 250+ Private Equity Funds Private Equity & Venture Capital Firms with more than 1,000 entities EISNERAMPER LLP EisnerAmper LLP Best Global Accounting Firm

With over 1,500 employees in international and build on the excellent hedge fund locations, over 250 employees and 40 services business we’ve built in the US. partners dedicated to the financial services It’s taken many years to build our position practice, EisnerAmper LLP has the breadth and reputation in the US market. And we to handle global engagements and provide understand the same will apply to London,” comprehensive guidance and support to its states Napolitani. roster of hedge fund clients. “There are a number of reasons why EisnerAmper currently services a large managers choose a mid-market accounting number of hedge funds and private equity/ firm like EisnerAmper. One is that we have venture capital sponsors. Whomever the a number of partners with extensive Big client, the firm always strives to speak Frank Napolitani, Director, Four experience working for us, meaning their language and avoid using technical Financial Services at clients are able to access a deep bench of EisnerAmper LLP accounting jargon. specialised talent. “With respect to hedge funds, our book “Secondly, when managers are going of business grew by approximately 100 new through ODD, institutional investors might funds clients in 2017 and over 300 new fund say that they would prefer them to move clients since 2015. We service over 1,350 upstream from a boutique outfit to a hedge funds and fund-of-funds and over middle-market operator, which plays to our 1,000 venture capital/private equity funds.. advantage,” explains Napolitani. “When I joined three years ago, Such is the complexity of regulation and EisnerAmper had 1,000 funds. So we’ve compliance, managers have questions they enjoyed significant growth over a three-year want asking. They want to know they can period,” explains Frank Napolitani, Director, talk to trusted partners to get advice and Financial Services at EisnerAmper LLP. Charles Weinstein, CEO at build consensus before they move into EisnerAmper LLP Over the years, EisnerAmper has forged certain areas and as Napolitani remarks: “We a reputation in the US market for delivering are happy to be there for them.” proactive, responsive, high quality service. The consulting group with EisnerAmper This is due, in part, to the commitment to financial services, which comprises Napolitani, partner-level involvement. Jaclyn Greco in New York and Eugene Tetlow To build on that reputation and brand in San Francisco, is actively engaged with the equity, EisnerAmper announced last week market every day. This places EisnerAmper at that it is opening an office in London, a competitive advantage to other accounting headed up by Robert Mirsky, who will also firms who don’t have a consulting group and operate as Head of the Asset Management is one of the reasons for its continued year- Group. “As Brexit unfolds, Europe is facing on-year success. an unprecedented period of economic and “For over 20 years, I’ve always stuck to regulatory challenges and opportunities,” the idea of helping clients first, and sticking commented Charles Weinstein, Chief to my word. Culturally, that loyalty has Executive Officer of EisnerAmper LLP. He extended to our financial services consulting added that Mirksy, a prominent figure who group as a whole,” says Napolitani. has been advising investment fund managers On winning this year’s award, he for more than 20 years, will “greatly enhance replies: “We are honoured. We’ve been the our ability to offer clients highly specialised, beneficiaries of a number of industry awards expert financial advisory services”. and believe our focus on providing high “At the moment, managers use either quality client service coupled with extensive the Big Four or smaller boutique firms alternative investment experience has been so we believe the time is right to step in the bedrock of our growth in recent years.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 8 DMS Governance is the worldwide leader in fund governance + risk + compliance, serving more than $350Bn in fund assets and 60% of the top investment managers globally. DMS excels in delivering high-quality professional services across a diverse range of leading global institutions and emerging managers.

Matthew Brown David Morrissey Executive Director I London Executive Director I Dublin

[email protected] [email protected] (p) +44.020.3709.6901 (p) +353.1.619.2342 (c) +44.7880.322.561 (c) +353.86.042.9826

Daniel Forbes Connie Wong Executive Director I New York Director I Singapore

[email protected] [email protected] (p) +1.212.257.5052 (p) +65.6911.3691 (c) +1.646.823.2512 (c) +65.8823.4818

Dawn Cummings Francine Balbina Executive Director I Cayman Islands Executive Director I São Paulo

[email protected] [email protected] (p) +1.345.749.2419 (p) +55.11.2787.6213 (c) +1.345.325.1974 (c) +55.11.9905.8021

Darren Gorman Niaz Khan Managing Director I Luxembourg Managing Director I Hong Kong

[email protected] [email protected] (p) +1.353.1.619.2325 (p) +852.3478.3822 (c) +1.353.87.940.0041 (c) +852.9137.3236

DMSGOVERNANCE.COM DMS GOVERNANCE DMS Governance Best Offshore Regulatory Advisory Firm

DMS Governance (DMS) is the worldwide “We are delighted to receive leader in fund governance representing this award from Hedgeweek leading investment funds with assets under management exceeding USD350 billion. which serves to recognise DMS excels in delivering high-quality Fund our commitment to delivering Governance, Risk and Compliance services across a diverse range of investment fund high-quality and tailored structures and strategies. services to the global fund As well as supporting clients who wish to management community.” launch UCITS funds or Alternative Investment Funds, using DMS Investment Management David Morrissey, Executive Services (Europe) Limited (DMS IMS) as Director, DMS Investment are entertaining are from institutional fund Management Services groups who are looking for a fund-wide the appointed AIFM or UCITS management (Europe) Ltd company, DMS can also provide MiFID solution by availing of a ManCo: “A few services, such as trade execution, verification years ago, we were having discussions with and settlement through its MiFID firm, DMS managers looking for single fund solutions, Market Access. This is a huge value-add that now we are talking to managers who have a lot of DMS clients are taking advantage of. fund ranges that require a solution in terms “We are currently the only third-party of marketing in Europe.” management company with a MiFID entity in The DMS brand is well known and highly Ireland,” confirms David Morrissey, Executive regarded in the international marketplace. Director, DMS IMS. He says that MiFID II “That helps us to stand out from a lot of has been a huge driver of growth for domestic management companies in the DMS Governance over the last 12 months. Irish market. “The fact that we have a fully operational “Secondly, most of the mandates we won investment manager, authorised under in the early stages were mandates being MiFID, which meets the requirements of the awarded by investors. The benefit we were MiFID II Regulation, is proving beneficial to able to demonstrate to them was that we our clients, particularly for managers who are were truly independent and that we built our concerned with Brexit. It has helped us in management company from the ground up, securing some significant mandates. along the lines of an investment manager. “Non-European managers face a challenge “We have our own, highly experienced, over whether to add internal resources to their risk, legal and compliance teams supporting UK office, which might only be a satellite office the European ManCo and MiFID firm and of the parent company, or whether to look for that substance and infrastructure sets us an external outsourced partner. The latter has apart from others in the marketplace. From very much played to our advantage.” day one, that team has been providing “We are also looking to add certainty to investment management oversight to clients. UK managers in respect of Brexit by allowing The team includes experienced traders who them to avail of a European-based MiFID speak the same language as the portfolio entity, which would not cause them any managers we work with,” explains Morrissey. issues in relation to European funds. That is On winning this year’s award, he something that we are discussing presently concludes: “We are delighted to receive this with a number of UK-based fund managers,” award from Hedgeweek which serves to explains Morrissey. recognise our commitment to delivering high- Morrissey estimates that close to 60 to 70 quality and tailored services to the global per cent of the mandates DMS Governance fund management community.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 10 JONESTRADING JonesTrading Best Outsourced Trading Provider

JonesTrading’s heritage goes back seven traders which has helped to create a culture decades following the Great Crash. George of interdependence and trust. Jones, Sr, the grandfather of current “This spirit of cooperation,” says chairman, William “Packy” Jones, was one LeVeen, “not only makes the trading of the principals of equity brokerage firm, network more cohesive, but also fosters Mitchum & Tully, later to become Mitchum, a creative environment where traders can Jones & Templeton in the 1950s. Jones Sr proactively find liquidity on behalf of each helped grow the firm into the largest equity individual client. The emphasis on retaining brokerage headquartered outside of New experienced traders as a cornerstone of York. The firm’s outsourced trading office is our business also helps to explain why we based in Charleston, South Carolina. Jeff LeVeen, Managing have one of the lowest turnover rates in the Over the decades, JonesTrading has had Director and Head of securities industry. As Packy Jones is proud Outsourced Trading at to say when new people arrive: ‘Welcome to a singular focus: securing liquidity for its JonesTrading clients, regardless of style or strategy. Clients your last job,’” says LeVeen. rely on JonesTrading to proactively source JonesTrading views itself as the ‘go to’ the liquidity needed to execute block trades destination for institutions wishing to engage in domestic and global equities, options and in any outsize or difficult trade. In short, listed derivatives. it acts as an industry engine for liquidity By remaining neutral and ensuring that generation. Its traders apply their knowledge its clients remain anonymous at all times, to every trading situation to assist clients the firm executes client trades in a way that in meeting their investment goals and in minimises market impact and opportunity improving overall portfolio performance. cost. This has led to JonesTrading becoming LeVeen adds: “Building an outsourced a highly valued platform by a large array of trading platform that has the best hedge funds and traditional asset managers. possible access to the legacy business of Moreover, by using best-of-breed third-party JonesTrading was an easy decision. Many of trading tools and independent research, our clients understand that electronic trading it creates a seamless link for the firm’s is necessary for both minimising the cost to traders to act as an extension of its clients’ execute and providing an additional layer of trading desks. anonymity. Reflecting on last year, Jeff LeVeen Jr, “Our platform also provides our clients Managing Director and Head of Outsourced uncompromised access to our internal Trading, says: “In 2017 we saw continued block liquidity. This internal liquidity gives demand for the outsourced trading offering. our clients the opportunity to source We had tremendous interest from both liquidity not currently available to them in launching managers, but also clients dark pools. This aspect of our offering that were currently outsourcing with our is extremely valuable to our larger competitors. We selectively added a number outsourced clients who are trading larger of clients to our platform and we’re seeing positions in potentially less liquid stocks,” follow through as we enter 2018.” explains LeVeen. The majority of JonesTrading’s outsourced On winning this year’s award, Packy trading clients are US equity long short Jones comments: “It’s a great honour managers running AUMs of USD50 million to be recognised by Hedgeweek and to USD1 billion-plus. “We cover a number of its subscribers. This is yet another sector-focused managers and a number of acknowledgement of the hard work we have generalists as well,” confirms LeVeen. put into building a well respected platform for JonesTrading is owned and run by its clients looking to outsource their trading.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 11 JP Fund Administration would like to thank its clients for their support in voting us the Hedgeweek Best Offshore Fund 2018 Administrator of 2018. Thank you!

jp integra group is the leading Cayman specialist in trust, private equity, and fund solutions for international private, institutional and sovereign clients.

t: +1 (345) 943-2252 e: [email protected] w: jpintegra.com JP FUND ADMINISTRATION JP Fund Administration Best Offshore Hedge Fund Administrator

Award-winning hedge fund and private We have worked with several international equity administrator, JP Fund Administration banks on constructing fund structures (Cayman) Ltd, has grown its Assets Under to enable their private clients to deploy Administration (AUA) to more than USD5 compliant offshore capital that has been billion, bringing the JP Integra Group total freed up by the sequence of tax amnesties AUA to more than USD6 billion. and collection efforts of various Latin JP Fund Administration is one of the three American countries.” core operating companies that comprises Discussing the internal culture, Cockhill the JP Integra Group; the other two being: JP says that a combination of experience and Integra Trust Company (Cayman) Limited and ability in both management and staff across JP Management Services Limited. All three Peter Cockhill, CEO, JP Integra its group operating companies “is a key companies are headquartered in Cayman Group factor and strength of our group”, building and are licensed by CIMA. solid relationships with clients, sharing “We are delighted by the growth of our experiences and understanding their needs AUA, especially as it has been built up by so as to deliver excellent service. new private equity and family office private “Our management team comes from a fund vehicles,” comments Peter Cockhill, variety of backgrounds: financial markets, CEO, JP Integra Group. banking, private client, international “Our fund administration business is operations and law, with the result that we the cornerstone of JP Integra’s operations are usually able to share the perspective and our fund-related business proposition of our clients as we have experience of in which we can provide the full suite of walking in their shoes. Financial technology administration services as well as establish and operating platforms are evolving very funds and related vehicles has enabled us to quickly and driving major changes in favourably distinguish ourselves from many financial services, but ultimately establishing of our competitors.” and administering client vehicles is a matter 2017 was a year of building foundations of confidence and trust and there is no for growth with investment in systems substitute for experience and integrity,” and processes to enhance JP Fund explains Cockhill. Administration’s operational capabilities in He adds: “In addition to the human factor, support of its growing base of investment we also hold a trust licence and a company funds. It has, for example, obtained the management licence, which in many cases SOC 1 accreditation to demonstrate that the enables us to provide a more rounded and processes and systems in place meet the personal solution to our clients.” highest international standards. JP Fund Administration’s clients are widely Funds with more complex requirements dispersed in Europe, Asia and the Americas. has traditionally been an area where JP As such, building upon existing client Integra can distinguish itself by providing networks and improving its sales distribution project management and structuring in through the appointment of experienced and addition to administration services, says knowledgeable financial services professionals Cockhill, confirming that in 2017 private equity in each of these geographic regions “will be funds for sovereign wealth fund joint ventures our focus in 2018”, confirms Cockhill. “has added a new string to our bow”. On winning this year’s award, Cockhill “There has been much general comment remarks: “It is a real compliment from the made about the overlap between private clients that voted for us, for which we equity and hedge funds, but for us the are very grateful, and it is testimony to nexus has been between private funds and the professionalism and commitment of associated corporate and trust structures. our staff.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 13 OVERVIEW

5 who make skilled active long/short bets with Among all prime brokers the collective judicious use of leverage and concentration. belief is that sophisticated investors are On balance, Optima sees the risks as always willing to pay for alpha. That said, the skewed in favour of a higher visibility, mid- more experienced investors get at investing to-late cycle global economy that may in hedge funds, the more discerning they incur bouts of higher volatility, but generally become. By partnering with best-in-breed favours the active manager. service providers such as Cowen, whose Prime brokers will understandably equities research team alone marks it out welcome any developments that encourage from much of the competition, hedge fund more trading activity. Firms like Cowen, managers take confidence they can be whose prime brokerage business is an supported in seeking out new sources integral part of its institutional offering, are of alpha. singularly focused on ensuring they can Indeed, the role of manager and service help their active manager clients outperform provider (or partner) has become more to the best of their abilities and view integral than ever before, especially with themselves as an integral part of their alpha respect to research capabilities. Under generating capabilities. MiFID II, European managers will only be 24

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 14 Managing Substantial G10 Foreign Exchange Portfolios Since 1991

Hathersage Capital Management LLC Greenwich Village, New York City email: [email protected] HATHERSAGE CAPITAL MANAGEMENT Hathersage Capital Management Best Foreign Exchange Hedge Fund

Hathersage Capital Management LLC is “Being recognised by a discretionary global macro investment Hedgeweek readers, many of manager founded in 1991. The firm is a foreign exchange specialist, expressing its whom are our investors, is a global macro views strictly in G10 currencies, very special honour.” using interbank spot, forwards and vanilla options. Hedgeweek’s readership voted can add meaningful portfolio diversification. Hathersage Capital Management’s Citi The Hathersage team uses traditional Access G10 Macro Access Strategy the fundamental macroeconomic analysis to Best Foreign Exchange Hedge Fund at Bill Lipschutz, Hathersage generate high probability trade ideas and the 2018 Hedgeweek Global Awards. This founder and Chief Investment create asymmetric directional exposures in Officer is the third year in a row that Hedgeweek its G10 Macro Access Strategy. Portfolios has recognised Hathersage as the leading always maintain net long convexity, which foreign exchange investment manager. limits the downside in moderate adverse With the era of ultra-easy monetary price moves while enabling positive policy nearing an end, rising interest rates performance during periods of extreme and inflation fears have brought increasing market dislocations. The strategy has an concern about credit spreads and equity annualised return of 19.05% since the valuations. Advances in technology have 2011 inception of the programme on the accelerated financial innovation and the Citi Macro Access Platform, making it the systematic, quantitative management of top absolute return performer among all risk factors. But they have also increased participating managers over that time frame. correlations across asset classes. The recent Responding to investor demand, sharp correction in equities and the spike principally out of Asia, for direct access in the VIX highlight the importance of non- to the Citi G10 Macro Access Strategy, correlated, satellite diversification around a Hathersage Capital Management has core investment portfolio. launched a Cayman-domiciled G10 Macro Hathersage’s flagship discretionary, Access Fund. The fund employs the same macro-based strategy offers historically low award-winning strategy that was previously average correlation when global equities only available via the Citi Macro Access are rising. But when global equities fall one Platform. The fund offers a highly competitive standard deviation or more, that correlation fee structure (the higher of the management becomes highly negative, helping to cushion fee or incentive fee with a high water mark) the impact of a mark down in an equity beta- with no long-term lock-ups. centric portfolio when it is needed the most. On winning this year’s Hedgeweek award, The portfolio management team at Bill Lipschutz, Hathersage founder and Chief Hathersage has been managing substantial Investment Officer said: “Being recognised G10 FX portfolios for more than three by Hedgeweek readers, many of whom are decades. In an age when systematic our investors, is a very special honour. We trading and alt-beta exposure has grown commend Hedgeweek on their great job dramatically, an experienced discretionary acknowledging the achievements of the manager who understands how to utilise many talented investment managers and optionality and understands market nuance service providers in our industry.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 16 COMPREHENSIVE SOLUTIONS FOR INVESTMENT MANAGERS

Cowen Prime Services offers a comprehensive suite of brokerage and related services that provide N PRIME SER WE VIC investment managers with solutions that are CO ES Portfolio & US Prime customizable and scalable. Risk Analytics Brokerage

The firm was built by former investment managers New Launch International Consulting Prime Brokerage to serve hedge fund managers, managed account platforms, institutional investors, family offices and registered investment advisors with turn-key Capital Electronic & solutions designed to free our clients to focus on Introduction CLIENT High-Touch Execution their core competencies — investing. Pre & Post Trade Outsourced Compliance Trading Solution Cowen’s global offering features: US prime brokerage, international prime brokerage, Middle & Back Commission Ofﬁce Support Management electronic and high-touch execution, outsourced Financing & Stock Loan trading solution, commission management, financing and stock loan, middle and back office support, pre- and post-trade compliance, capital introduction, new launch consulting and portfolio and risk analytics.

Best Global Prime Broker Best Boutique Prime Broker Best North American Prime Broker Best Prime Broker – Innovation Award Winner 2018 2017 HFM Awards USA Award Winner 2017 2017 HFM European Awards

COWEN.COM COWEN INC. COWEN COWEN PRIME SERVICES LLC MEMBER: FINRA/NFA/SIPC COWEN PRIME SERVICES Cowen Prime Services Best Global Prime Broker

“When I look back at what we’ve been able are few organisations like us that emphasise to accomplish, 2017 was a pivotal year for us sophisticated research as well as provide in terms of establishing our unique identity,” innovative market liquidity solutions for clients comments Jeffrey Solomon, CEO of Cowen, on a non-conflicted basis,” explains Solomon. of which Cowen Prime Services is a core During 2017, Cowen’s research reports division. were read over 4.2 million times and “During 2017, we unveiled our new the team published over 170,000 pages firm brand identity which highlights our of research. It currently has over 900 commitment to ‘outperform’ in all of our companies under coverage and conducted business endeavours. It crystallises our over 7,300 analyst meetings with clients mission at Cowen: To advise and connect Jeffrey Solomon, CEO of Cowen throughout the year. aspirational users and providers of capital to These stats give some indication as help both of them outperform.” to how much of a quest clients are on In an investing world that is split between to find alpha. They are aggregating their those who engage in active investing and time with firms like Cowen that specialise those who engage in passive investing, in industry areas of expertise, such as Cowen is 100 per cent focused on those healthcare, technology, consumer, energy who believe in the value of active investing. and industrials. “Our brand concept of helping people “You need to be able to help clients make to outperform emanates from the idea that better investment decisions more quickly,” everything we do as an organisation has adds Solomon. “There is so much alpha to to be exceptional because the pressure be generated from data and data analytics. on active managers to outperform passive Not only do we have the ability to access managers has never been greater,” says some unique data sets but we can also Solomon. query those data sets to enable managers to Cowen has made some strategic cut through the noise.” decisions to further enhance its prime According to Solomon, from a cultural brokerage business, including its acquisition perspective, three character traits define of Convergex in 2017 and expanding its US the Cowen employee: vision, tenacity and and international prime services capabilities empathy. through Cowen International Limited. “Cowen is celebrating its 100th anniversary “Being named ‘Best Global Prime Broker’ this year. That kind of longevity is quite an is further validation that we are building out accomplishment in our industry. I believe from our core strengths and focusing on the that we have persevered because of our areas where we have domain expertise,” vision to sense opportunities, anticipate new explains Solomon. challenges and constantly innovate. Certainly, Equity execution and research are I don’t think we have faced an environment additional areas where Cowen has domain where we need to be more tenacious than expertise. we do today. From an empathy perspective, “In a post-MiFID II world, sell side firms when we walk in the shoes of our clients we have to be excellent in both research and are able to find the right solutions for their trade execution in order to garner market particular circumstances,” says Solomon. share. We have long been recognised as a On winning this year’s award, he premier research brand. However, following concludes: “It is testament to the fact that our acquisition of Convergex, we are now Cowen has never been in a better position one of the largest independent non-conflicted to help its prime brokerage clients navigate equity execution firms on the Street. There the changing markets.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 18 One platform. Infinite possibilities. Derivitec products has been designed to allow users to understand the risk on their portfolios clearly, and effectively. Available out of the box as a powerful web application, or integrated directly into the client’s own applications, Derivitec covers your risk needs from initial analysis to final attribution, providing complete transparency across all stakeholders in your organisation.

Calculate Hosted natively in the cloud, Derivitec risk engines will automatically scale out to handle the complexity of your requirements. With industry standard models and a 24‐7 market data process running in the background, Derivitec can calculate arbitrarily complex reports across all major asset classes.

Integrate We supply APIs to support every part of your process, from the initial order to final PnL attribution, enabling you to leverage the power of our data and analytics on top of your existing workflow systems with minimal integration cost .

Evaluate Available out of the box through our award winning Risk Portal, or through Python integration, you can drill into your risk numbers, both pre and post trade, in as much detail as you require. Our APIs also allow you to prepare white labelled risk reports for your own stakeholders. Complete transparency, exactly the way you want it.

For further information, or to request a demo, please contact: t: +44 203 668 3682 e: [email protected] www.derivitec.com DERIVITEC LTD Derivitec Ltd Best Risk Management Software Provider

Derivitec Ltd was born in 2011. Initially, it PAG’s existing architecture to provide a high- started life as a derivatives analytics software grade platform covering order and execution vendor. “Then I started to do some deep-dive management together with a comprehensive market research into who in the market was and multi-faceted analytics framework. successful and why. Two points clearly stood The next step is to open an office there, out in my mind: ease of use, and scalability,” which Kaye hopes will be in the next few says George Kaye, founder and CEO of months. Derivitec. Stressed markets and jump events are The firm’s central philosophy, he says, is welcomed by the Derivitec team as they to make it as easy as possible for people provide validation that the platform does in the financial industry to provide validated George Kaye, founder and CEO exactly what it is supposed to; namely, to risk management reporting: “That includes of Derivitec support clients in actively managing risk in everyone from small hedge funds to global real-time. Brexit was a case in point. sell-side institutions.” “One of our clients, AFEX, a large global At the heart of the Derivitec model is the payment remittance company, said that using ability to analyse a portfolio of derivatives the Risk Portal allowed them to warn their exclusively on the cloud, with no need for clients ahead of Brexit of what the effects users to go through the time and ongoing would be of a 10 per cent fall in sterling costs of a system install. against the dollar, and the subsequent effect “We’ve gone from derivatives analytics it would have on their margin and collateral. through to risk reporting, both pre- and It was a sound test of the facilitation of our post-trade. This has been helped by the platform. development of our APIs, which plug into “I like to refer to it as ‘visceral risk other vendor systems and can be used management’; the day-in day-out directly by clients, empowering them to do monitoring of risk and margin positioning their own deep dive analysis. It has greatly that institutions need to keep on top of,” widened the scope and functionality of our comments Kaye. product. Until last year, Derivitec was “We provide global coverage on six asset predominantly a post-trade system. It now classes – equities, fixed income, credit, offers pre-trade risk capabilities. This allows commodities, FX and rates – and handle institutions to do bespoke analysis and back- everything from regulatory reporting through testing before putting on trades to see what to VAR, on vanilla equities through to the risk impact will be on the portfolio. complex derivatives,” explains Kaye. “It has become much more of a front- At the end of 2016, Derivitec received new office application, which has been an investment from a Hong Kong venture capital exciting evolution,” adds Kaye, who hopes firm, which has also been helpful in securing 2018 will be “bigger and better”. Derivitec mandates from a number of Hong “We will continue to enhance the Kong-based hedge funds. applicability and usability of our products One example of this is the announcement across the industry, with a strong focus on made by Derivitec last August that it was front end development, including adaptation collaborating with Messer Financial Software to mobile devices.” to provide straight through risk processing On winning this year’s award, Kaye for PAG, one of Asia’s largest alternative concludes: “This is a great honour, not least investment management firms. from the fact that the award is based on the The solution seamlessly integrates into feedback of our clients.” n

Decidedly Distinct

Custody provided by UMB Bank, n.a. Distribution provided by UMB Distribution Services, LLC.

At UMB, our culture and client-focused approach Visit umbfs.com for more set us apart from other administrators. Our team information about our comprehensive services for: excels at building consultative partnerships, anticipating your needs and delivering unparalleled service and + Mutual Funds expertise to support your growth. + Private Equity Funds + Hedge Funds Let’s partner on your next success. + Funds of Funds + Interval/Tender-Offer Funds + Exchange-Traded Funds + Collective Investment Funds UMB FUND SERVICES UMB Fund Services Best Liquid Alternatives ’40 Act Fund Administrator

Whereas a few years ago, managers were half-heartedly. The regulations and limitations jumping in to the ’40 Act mutual fund market of the ’40 Act require a different mindset to to either launch standalone alternative that of running a private fund. “Outsourcing mutual funds or become sub-advisors to accounting and administrative support is multi-manager products. The fact is that required and selecting an experienced there are so many regulations, that trying to partner in both ’40 Act’ funds and alternative replicate a hedge fund strategy – or even a strategies is crucial,” stresses Quill. diluted version of it – is difficult. She adds that UMBFS’ experience in A potentially more effective alternative supporting administration and accounting for is the unlisted closed-end fund (CEF); also both ‘40 Act funds and alternative investment known as an interval fund or tender-offer fund Maureen Quill, President of strategies allows it to quickly adapt to UMB Fund Services’ (UMBFS) Registered UMB Fund Services servicing unlisted CEFs “so the asset Fund Solutions platform gives managers the managers can focus more time on managing opportunity to launch an unlisted CEF which their products and investors”. may take daily subscriptions but only redeem Technology is key to being a successful once a quarter or otherwise as determined administrator, no matter what the asset by the board of trustees. Along with ETFs, class. UMBFS is continually evolving its the unlisted CEF garnered the greatest automated financial reporting processes interest from its client base in 2017, according to meet changing regulatory requirements. to Maureen Quill, President of UMB Fund For example, significant SEC modernisation Services. regulations go into effect this summer and “The interest in these registered unlisted administrators like UMBFS stand ready to closed-end funds (including interval help managers meet these robust reporting and tender-offer funds) continues to be and liquidity risk management requirements. significant. While these products often take a “This year we are also rolling out little longer to get started from a registration additional enhancements to our transfer perspective, we are hearing more and more agency workflow and automations for from clients and prospects interested in unlisted closed-end funds,” confirms Quill. developing a product,” says Quill. “We have had a robust proprietary business UMB Fund Services continues to be a processing solution in the transfer agency leader in this space. According to the 2017 for some time and expect these fine- Mutual Fund Services Guide, the firm is tuned enhancements will provide smarter ranked the top transfer agency for registered processing and improve our ability to scale closed-end funds by number of shareholder our business as the momentum in this accounts. product grows.” Last year, in partnership with FUSE This year, UMBFS will be focused on Research, UMBFS published a report continued technology investments, with identifying over 109 unlisted CEFs available Quill referencing the need to support an for purchase with total assets under evolving product landscape “We are working management at approximately USD41 to position our firm to continue to be a top billion. Quill says that the data in the report service provider regardless of the product “validated the perceived momentum for structure,” she says. these products” and that momentum only On winning the award, Quill remarks: “We increased throughout the remainder of 2017. are thrilled to be recognised by Hedgeweek’s For most hedge fund managers, the readership as we continue to focus on registered product space is a whole new meeting the needs of asset managers today world and isn’t something they can enter into and into the future.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 22 HARNEYS Harneys Best Offshore Law Firm

Harneys operates through 14 international banking and finance group and Ana Lazgare, locations and its global funds practice advises associate,” says Gobin. on all aspects of offshore investment funds, Nicole advises on structured finance, establishment, maintenance and restructuring including US CLOs and emerging market both in distressed and planned scenarios. future cash flow-backed securities, secured The firm’s global investment funds practice lending and fund finance and also brings continued to grow in 2017, particularly in further expertise in hedge fund and private Cayman and Hong Kong. Harneys is now fully equity transactions, particularly in LatAm. entrenched in the Cayman Islands, celebrating Ana is a Mexican, BVI and Cayman Islands its 10th anniversary this year. Its market qualified lawyer, who has worked with Nicole disrupter approach and mentality has taken the Ian Gobin, Partner at Harneys for many years. “They link up perfectly with our offshore investment funds market by storm. offering in North America and dove-tail with “It’s a conscience decision to be the our strengths in South America, through our market disrupter. It’s who we are. It’s in offices in Sao Paulo and Montevideo,” says our DNA,” says Ian Gobin, who heads- Gobin, adding: “It’s been an amazing year with up the Cayman Islands investment funds the talent we have attracted to the Firm. We team. Gobin says the Cayman investment agree with Richard Branson, ‘If you look after funds market was “crying out” for a viable your staff, they’ll look after your customers’.” alternative to the norm. Harneys prides itself on being able to “We are rapidly closed the gap between us offer bespoke services to clients, whether and top two firms in the jurisdiction through institutional or boutique managers. Its size, our strategic onshore partnerships with collegiate atmosphere and flexible teams complementary service providers, firms and allow Harneys to work across departments people who see the world the same way as and offices. us. We continue to target a wider client base “We challenge the industry by bringing through our extensive marketing campaign. personality to the table with our clients. Our focus remains on the North American We have a different culture to a lot of other and LatAm markets,” confirms Gobin. offshore law firms. Rather than simply On new offshore developments, the firm provide an anonymous service from a invested early in the FinTech space through distance, if a client is looking for an offshore their investment fund teams in Cayman, BVI law firm to be their back-office legal team and Vancouver. “We are the ‘go-to’ offshore and provide real value at the right price firm for ICOs and crypto-asset funds. It’s a point, they should look no further than great space for us to be in. We committed Harneys. Ultimately, our job is to make the to being the market leader in this space life of a general counsel and fund manager several years ago. The pace of the market as easy as possible,” comments Gobin. was incredible last year and it’s just getting Gobin says that the end of 2017 was started. We’re now seeing institutional incredibly strong and, if Q1 2018 is anything players probe and show interest with this to go by, “it’s going to be a another record market,” says Gobin. He says that Harneys year for us”. is extremely opportunistic and nimble in all On winning this year’s award, Gobin aspects of its business. remarks: “By continuing to challenge the “We saw an opportunity to not only industry norms, and at the same time strengthen our investment funds team but holding onto our core values and historical also our structured finance, banking and roots, we are innovating and enhancing the corporate teams with the hiring of Nicole market for offshore. We thank our clients and Pineda, as a partner and new head of our our business partners in the industry.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 23 OVERVIEW

14 willing to pay for the highest quality research opportunistically, into other business lines that they believe can justify the costs. In throughout 2018. many ways this is game changer. Prime The intention is to incubate a number brokers will be under the spotlight more than of businesses as opportunities present ever on the issue of research. Quite simply, themselves. This might include opportunities there will be winners and losers over the brought to Invast Global by Investment Bank coming few years. executives who are looking to move their But that is not something to fear. As this business to a more accommodative, flexible industry has demonstrated time and again, platform; or opportunities that its existing necessity is the mother of invention. Service staff recognise themselves. providers and managers will find new ways Invast has created an environment to work and collaborate to achieve the most for intelligent, hardworking people to optimal outcomes. build businesses they are passionate Firms like Invast Global, a prime-of- about. Such businesses might include, prime, have grown their multi-asset Prime custodian services, fund administration Services offering very successfully over the capital introduction, regulatory/compliance past few years and has plans to expand, advisory, etc. 35

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 24 AT ALTANA WE CONTINUALLY MINE FOR NEW SOURCES OF ALPHA IN 2017 WE STRUCK DIGITAL GOLD

WE ALWAYS CO-INVEST ALONGSIDE OUR CLIENTS

Congratulations on winning Hedgeweek's "Niche Hedge Fund Award"

To the ALTANA DIGITAL CURRENCY FUND and ALISTAIR MILNE, CIO

FOR A RECORD BREAKING YEAR www.altanawealth.com [email protected] Follow Alistair on Twitter ALTANA WEALTH Altana Wealth Best Niche Hedge Fund

In Monaco back in 2013 – when bitcoin etc, we are one of a small number of truly was priced at USD100 – Alistair Milne, an experienced crypto-asset managers. Internet entrepreneur since 1996, approached “You can count how many funds have Lee Robinson with the idea to launch an experienced a crypto bear market on one innovative digital currency hedge fund. What hand. We offer investors peace of mind that resulted, in May 2014, was the Altana Digital we know what we are doing ... and have our Currency Fund (ADCF), the first actively own capital at risk alongside theirs.” managed, multi-asset cryptocurrency fund of With respect to volatility, Milne says that its kind in Europe. the team ensures that it warns all of its In 2017 ADCF returned a phenomenal investors that “this is a high-risk investment 1496% (after fees). Since inception it has Alistair Milne, co-founder and and to not be over exposed”. returned over 2500 per cent, outperforming a CIO at Altana Digital Currency “We have written to our investors on Fund passive investment in Bitcoin every year. multiple occasions advising them when we ADCF enables investors to gain actively are taking profits ourselves, encouraging managed exposure to Bitcoin and other prudence. We last did this when Bitcoin digital currencies. The fund trades up to broke above USD19,500.” 50 per cent of its NAV and aims to take As to where ADCF should fit within their advantage of volatility and increase investor wider portfolio, Milne states: “We believe it returns, rather than passively benchmark. It should be seen as both a hedge against is able to achieve this by going long as well systemic risk, as well as a spread-bet on the as short, hedging with puts. future of blockchain and cryptocurrencies as Bitcoin certainly made a lot of headlines in a new technology and asset class.” 2017 as its value rocketed twelve-fold against Robinson established Altana Wealth in the greenback. Discussing the markets, 2009 to manage his personal wealth. Prior Milne, the co-founder and CIO of ADCF, to this, Robinson co-founded Trafalgar remarks: “Last year saw more than 150 new Asset Managers where he was CIO of hedge funds enter the cryptocurrency space. Trafalgar Catalyst Fund and Trafalgar Special “As one of the earliest to spot the huge Situations Fund. opportunity, we were very well placed to Neil Panchen joined as CTO in 2011 to capitalise, having already spent several build Altana’s IT infrastructure. Panchen held years acquiring the necessary knowledge, senior IT positions at Deutsche Bank, most experience and contacts. We are proud notably as Global Head of Commodities IT to have outperformed Bitcoin in such an and Global Head of FX IT. Panchen built incredible year.” the systematic trading algorithms for digital A minimum of 60 per cent of ADCF’s currency trading and is himself the portfolio cryptocurrencies are held in secure offline manager for Altana Cryptocurrency Trade wallets, aka “cold storage”, as opposed to Finance (ACTF) that offers trade finance to leaving them in custody with counterparties cryptocurrency traders. such as Bitcoin exchanges. Using multiple On winning the award, Milne concludes: secure physical locations dramatically “We once wrote to our investors ‘we prefer reduces the risk of loss. to be early than late’. When we setup the Asked to explain what makes ADCF such fund we knew Bitcoin and cryptocurrencies a compelling investment proposition, Milne had incredible potential that was largely replies: “In an environment where everyone overlooked. It is very rewarding to have our is now talking about Bitcoin, Ethereum, foresight independently recognised.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 26 You manage, we operate

ML Capital is your structuring expert for UCITS and AIFMD fund solutions. Helping clients bring new products to the market simply and cost effectively is just one way that we deliver value. Our specialist team will structure and operate your fund, while our experienced sales team will support your asset raising ambitions. +353 1 535 0912 [email protected] mlcapital.com

Dublin | London | Geneva Authorised and Regulated by the Central Bank of Ireland

1532 ML Capital-Advert (A4 Portrait)-V2.indd 1 05/11/2014 5:27PM ML CAPITAL ML Capital Best UCITS Liquid Alternatives Fund & Best UCITS Liquid Alternatives Platform

A lot has transpired since ML Capital commitment to being a distribution-led founded its Irish-domiciled MontLake UCITS platform business,” explains Day. platform in October 2010 during the first Matthew Williamson joined ML wave of the alternative UCITS boom. From Capital’s Dublin office last April, following launching with just a single UCITS Fund, ML a decade‑long tenure as COO of Man Capital finished 2017 with 25 UCITS funds on Investments in Dubai. His appointment as the Platform and over USD5 billion in Group General Manager further strengthens ML AUM, and now sits as one of industry’s most Capital’s capabilities. visible and successful players. “Over the last 12 months the firm has Richard Day, COO of ML Capital says 2017 gone from strength to strength. We’ve added was a record year for the group in terms Richard Day, COO at ML Capital significantly to the Dublin team, as we build of assets under management and top-line out the infrastructure to support the funds revenue growth: on our growing platform. We’ve taken new “Over the year, we added seven new premises on St Stephen’s Green, doubled funds to the platform. Among others, we the capacity to cater to our clients, and now launched funds with market leaders such as operate a 30-strong team. We also continue Crabel Capital Management (Crabel Gemini to support the asset growth of our managers, UCITS & Crabel Advanced Trend UCITS) and particularly on the passive distribution side,” Butler Investment Managers (Butler Credit comments Williamson. Opportunities UCITS), while Advent Capital ML’s sales team have nurtured productive Management took on the management of relationships with several key seeding one of our existing funds”. houses across Europe. More than half of Forming partnerships with industry-leading the new fund launches over the last two managers goes to the heart of what ML years have been driven by those investors Capital aims to achieve for its distribution who turn to ML Capital to launch a specific business – namely, finding the best products manager on the platform. to take to market. Fund selection for active distribution is “We saw some great traction last year far from a straightforward exercise. As Day on the asset raising side – the DUNN WMA explains: “We have to be careful in respect Institutional UCITS Fund, which is one of our of the funds we choose to actively distribute. leading distribution offerings, finished the Much has been invested in our relationships year at USD400 million and returned 10.6 per with investors and we want to always bring cent,” says Day. them only the best and mindfully curated “The team has put substantial focus investment ideas.” on Butler and Dunn and it was great to On winning both awards this year, Day see their efforts being rewarded by the remarks: “We are delighted to pick up the market. We launched Butler mid-2017 and award for the Best UCITS Liquid Alternatives took its AUM to north of USD100 million Platform for the second year in a row. It within four months. We added more than is a testament to the efforts of the whole USD200 million in AUM to the DUNN fund. ML Capital team. We also want to extend The in-house sales team at ML Capital has our congratulations to DUNN Capital raised in excess of USD1 billion of assets who manage the MontLake DUNN WMA over the past three years. Institutional and who picked up the Best “We’ve demonstrated to the market our UCITS Liquid Alternatives Fund.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 28

IRON COVE PARTNERS Iron Cove Partners Best Global Insurance Provider

Iron Cove Partners (ICP) is a leading full- and financial institutions will continue to service national insurance brokerage firm evaluate this ever-increasing risk. Regulators serving the financial services industry. see insurance protection as an integral part Headquartered in Garden City, Long Island, of a robust cybersecurity program “and we ICP is a trusted advisor with decades of couldn’t agree more,” comments D’Agostino. experience and over 150 Hedge Funds “The opportunity for us is more in tailoring as clients. existing Cyber Products specifically for ICP specialises in meeting the unique financial institutions. Not all Cyber Coverage insurance demands across all areas of is created equal, nor does all Cyber the financial services industry including: coverage apply to asset management firms. investment advisers; hedge funds; private Louis D’Agostino is Principal of “Most clients that take cybersecurity equity funds; mutual funds; broker-dealers, Financial Services practice at seriously are conducting cybersecurity Iron Cove and investment banks. assessments, penetration tests, vendor Louis D’Agostino is Principal of Financial due diligence as well as putting incident Services practice at Iron Cove, which response plans in place. Those managers provides expertise to hedge funds, registered also see the value of Cyber Insurance as advisers, private equity funds, broker-dealers, a compliment to a well implemented and and mutual funds. 2017 was another great robust cybersecurity program. year with D’Agostino confirming that ICP “As stated above, our goal is to navigate were able to exceed their new business our clients through the cyber coverage maze goals, “all while providing our clients in most and to discuss the elements of coverage cases with premium reductions. We also that are more applicable to the operations of had a successful rollout of our new Hedge asset managers, which will ultimately drive Fund D&O/E&O Product which gained a lot home the value.” of interest.” Social engineering coverage is a critical Discussing how hedge fund managers consideration nowadays, given that the loss view insurance, D’Agostino believes that of customer capital resulting from such an most view insurance protection as something attack can be catastrophic for small and mid- that is better to have and not need than to sized managers. need and not have it. D’Agostino confirms that while typical “While most professional lines of coverage cyber protection will provide coverage remain elective and not required by law/ for the related costs that a fund may regulation, I think most funds, once they hit incur in response to a cyber event (crisis critical AUM milestones, or for really large new management, incident response, forensics, fund launches, see it as a must have and best e-extortion, etc), “only a Crime/Fidelity Bond practice,” says D’Agostino, who continues: with Social Engineering coverage will provide “Our mission of educating, empowering and reimbursement for the loss of customer protecting is something we believe strongly in. capital. This scenario, while it appears Many of our fund clients are not “insurance unlikely, is perceived as a much more experts” nor should they be. It’s our job during substantive risk and one that appears to get the proposal process to provide a high level of everyone’s attention,” he says. education around all coverage elements and On winning this year’s award, D’Agostino possible claims scenarios.” comments: “We set out to build a Global One obvious trend in recent times has Financial Services Practice and winning this been the rise to prominence of cyber award for the second year in a row affirms insurance. This is set to continue to evolve that we are headed in that direction.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 30 Excellence in Alternative Asset Management Since 1988

“As investment pioneers in the hedge fund industry, we have accumulated a base of knowledge and a perspective on the market that is unsurpassed. “ D. Dixon Boardman, Founder and CEO”

OPTIMA ADVANTAGE INVESTMENT PROCESS High quality investment programs, rigorous Optima focuses on strong qualitative and risk management, superior client service, quantitative due diligence with a special thought leadership and technology are the emphasis on operational and portfolio risk foundations of Optima’s culture. management.

EXPERIENCED TEAM PROPRIETORY TECHNOLOGY Optima’s highly experienced team has A technology platform which integrates developed outstanding solutions for its manager due diligence, portfolio clients to successfully navigate complex management, research & risk analytics, and ever-changing markets. and accounting & operations.

Multi-Manager Programs Custom Advisory Services Single-Manager Funds Liquid Alternatives / UCITS

Optima Fund Management LLC New York

Thomas S.T. Gimbel (212) 484 3047 OPTIMA FUND MANAGEMENT Optima Fund Management Best Multi-Strategy Fund of Hedge Funds

It’s fair to say that Optima Fund Management enhancements, we never do so at the has seen a lot of change in the hedge expense of our core principals.” fund industry, given that it is preparing to As one would expect at a FoHF firm, celebrate its 30th anniversary. investment research is a fundamental skill-set Since Dixon Boardman founded the New that Optima’s team has built over the decades. York-based firm in 1988, it has steered a Like an apex predator, Optima always looks steady course. It has continued to evolve forwards, never backwards. Just because a in line with market trends so as to unearth manager has had a good run of returns for the best hedge fund talent, which feature in one, two, three years, there is no guarantee a range of multi-manager funds, the first of he will remain a staple of the portfolio. which, a long/short equity FoFs, has been Thomas Gimbel, partner and Commenting on the market environment, running since the year of Optima’s inception. Chief Portfolio Risk Officer at Michael Spelman, the CIO at Optima, sees Optima Fund Management “Despite all the changes in the the confluence of three key themes that are industry, Optima’s success is based on shaping the investing landscape as we head some important common denominators,” into the spring of 2018. says Thomas Gimbel, partner and Chief The first key theme is Policy Regime Portfolio Risk Officer. “First, we stick with Change, manifesting in three ways: first, the fundamentals that drive performance. with “QE” gradually transitioning to “QT”. Second, we avoid undue risk exposure, and Second, with a US tax overhaul heralding third, we make strategic adjustments when it the end of fiscal austerity and the return makes sense to do so.” to big budgets; and third, the move from Innovation is one of the key pillars on globalisation towards selective protectionism which Optima has built its business. and economic nationalism. “We’ve been innovative in some of the “The Second key theme is Economic FoHFs we’ve put together. For example, our Reflation, and with 2018 shaping up to be global macro fund was one of the first of another improving year for global growth, its strategy to ever launch, and our multi- we are witnessing falling unemployment, manager strategy, which launched in 2007 to rising leading indicators, stronger readings invest in the “best ideas” of a select group of of sentiment, and central bankers that are hedge fund managers, was well ahead of its moving at different speeds, but generally time,” says Gimbel. away from easy money policies. Asked to describe the culture that “The Third key theme is Asset Rotation. At Boardman has instilled at Optima, he adds: the asset class level we see more prominent “It is quality-obsessed, risk averse and Duration risk as rates head higher, and more innovative. It’s unique. We have looked at prominent credit risk as financing costs other firms to potentially acquire and typically increase.” have failed to find a culture fit. What has been On winning this year’s award, Gimbel created at Optima is a business with the concludes that it is gratifying for Optima to highest quality standards and a commitment be recognised by Hedgeweek: “Hedgeweek’s to both risk management and innovation. analysis is rigorous, objective and intellectually “It’s about sticking to your core honest which is of central importance to principals, maintaining the standards, and the industry. The most gratifying reward for never growing complacent. While we look Optima will always be the satisfaction of our to the future and always look to make investors as a result of good performance.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 32 2018’s Best Managed Account Platform: HedgeMark

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-Andrew Lapkin, Chief Executive Officer of HedgeMark

HedgeMark To learn more visit www.hedgemark.com

No representation is made that any Dedicated Managed Account’s investment process, objectives, goals or risk management techniques will or are likely to be achieved or be successful ”or that any Dedicated Managed Account or any underlying investment will make any profit or will not sustain losses. The risks of investing in hedge fund strategies will not be negated or even mitigated by HedgeMark’s Dedicated Managed Account platforms, analytic tools, compliance policies or monitoring and no assurance is given that any Dedicated Managed Account will not be exposed to risks, including but not limited to, significant trading losses and loss of principal. Dedicated Managed Accounts are not insured by FDIC (or any other state or federal agency) and are not deposits of or guaranteed by BNY Mellon. An investment in hedge fund strategies is speculative, should be discretionary capital set aside for speculative purposes, involves a high degree of risk and is not suitable for all investors. Investors could lose all or a substantial portion of their investment and must have the financial ability, sophistication, experience and willingness to bear the risks of an investment long term. Hedge fund strategies may be significantly leveraged and performance may be volatile. Accounts pursuing hedge fund strategies commonly enter into swaps, futures, forwards, options and other derivative transactions for various hedging and/or speculative purposes that can result in volatile fund performance. HedgeMark is a wholly owned subsidiary of The Bank of New York Mellon Corporation. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation and may also be used as a generic term to reference the Corporation as a whole and/or its various subsidiaries generally. Products and services may be provided under various brand names and in various countries by subsidiaries, affiliates, and joint ventures of The Bank of New York Mellon Corporation where authorized and regulated as required within each jurisdiction. Not all products and services are offered at all locations. The statements contained herein, are not an offer or solicitation to buy or sell any products (including financial products) or services or to participate in any particular strategy mentioned and should not be construed as such. Trademarks, service marks and logos belong to their respective owners. © 2018 The Bank of New York Mellon Corporation. All rights reserved. HEDGEMARK HedgeMark Best Managed Accounts Platform

Last year, hedge funds recorded positive reporting,” explains Joshua Kestler, President returns during every month to end the year and COO, HedgeMark. with gains of 11.41 per cent according to the A third key component to providing 2018 Preqin Global Hedge Fund Outlook report. bespoke MAP solutions to institutions is the For HedgeMark, a BNY Mellon company, ability to accommodate increasing scale. As this was particularly pleasing as institutional platforms grow and take on an increasing investors, particularly fund-of-fund managers, number of complex institutional clients, continued to adopt the use of dedicated they will need to find ways to continue to managed account structures to optimise efficiently deliver quality service. their hedge fund investment programmes; “We have made an investment in both something that HedgeMark excels in with its Andrew Lapkin, CEO at people and technology in an effort to ensure Dedicated Managed Account solution. HedgeMark that we have a scalable model which can “We also saw an increase in demand from accommodate a large amount of growth over the public pension space and we would time,” asserts Lapkin. expect to see a number of plans begin to HedgeMark has handled operationally build out their own dedicated managed complex strategies on the platform since account platforms in 2018,” remarks Andrew day one. This has allowed it to develop a Lapkin, CEO of HedgeMark. team, processes, and proprietary technology During 2017, HedgeMark added more to handle a wide range of strategies today, than USD4.6 billion in platform assets and as alternative risk premia funds, bank launched 36 funds; the highest annual loan funds and AI-driven funds become number since its inception. favoured by investors. Kestler confirms that HedgeMark is regarded as a pure play the operations system used by HedgeMark dedicated managed account provider, in Joshua Kestler, President and staff to perform daily functions such as that it assists clients in setting up and COO at HedgeMark reconciliations, collateral management operating their own private managed account and collateral optimisation, OTC lifecycle platforms. “We build and operate private management and NAV reviews, “is a unique platforms for our clients, independent of differentiator of the HedgeMark platform”. the hedge fund managers. The role of the When asked to describe the managers is limited to trading the portfolio,” internal culture, Lapkin talks about the explains Lapkin. entrepreneurial spirit within the core team He says that the key to HedgeMark’s ability that has built the HedgeMark platform from to offer a turnkey outsourced MAP solution the ground up. starts with the expertise and experience of its “As a BNY Mellon company, we think team to support the broad range of services that we offer clients the best of both worlds required to operate a platform. – we provide the feel of an entrepreneurial “We have built a team led by experienced boutique in terms of the high touch nature industry veterans across various disciplines of our client service while also offering including structuring, onboarding, operations, the benefits of the stability, controls and accounting, risk and technology. resources of a large, global financial “The second critical element is built-for- institution,” comments Lapkin. purpose technology, which provides our staff On winning this year’s award, he states: with an efficient and controlled means by “We are honoured to receive the Hedgeweek which to deliver the necessary services to award for Best Managed Account Platform our clients. This technology has been key for the 4th straight year. I believe that this to our ability to perform successfully, both recognition is a testament to the efforts and in terms of service delivery as well as client client service delivered by our team.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 34 OVERVIEW

24 Some of the new product launches coming to Europe to market their strategy in the pipeline for the first half of 2018 in a managed account format to potential include providing DMA connectivity to allow European investors it is regarded as a MiFID brokerages to offer access to a wide range activity, in which case they must have some of global exchanges to their private clients sort of MiFID representation. via the ubiquitous Metaquotes MT5 platform, This is playing into the hands of firms as well as advanced plans to open offices in such as DMS Governance, who not only Hong Kong and London. offers Management Company solutions to One point to mention on MiFID II is that those wishing to operate UCITS funds and many non-European managers think they are AIFs, but who also has a MiFID licensed not impacted because they only focus on entity. DMS is seeing increased demand global equities or US equities and therefore among investors for MiFID representation. won’t need to concern themselves with A large pension plan might, for example, transparency reporting requirements. award a managed account mandate to an What is more of an issue is that under this investment manager in New York, but in order regulation, if you are a US-based manager for them to maintain that relationship they need operating managed accounts for European to appoint a regulated MiFID entity; essentially investors you absolutely will be impacted, no DMS would enter into a tri-party agreement to matter what strategy is being pursued. This oversee that managed account on behalf of is catching people out. The fact is, if they are both the investor and the US fund manager. 45

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 35 PILLAR CAPITAL MANAGEMENT Pillar Capital Management Best Insurance-Linked Strategies Hedge Fund

Pillar Capital Management (‘Pillar’) was Velotti’s opinion, “We could potentially see founded in 2008 and is headquartered in enough capital sucked out of the market Bermuda. The firm manages open-ended that this could start to shift the market in Bermuda incorporated funds invested in the the other direction; and an important note to global property catastrophe risk market. make is that it will take time for the losses of The senior management team at Pillar, 2017 to crystallise.” headed up by CEO and CIO, Stephen Velotti, Rather than target returns, Pillar’s strategy has an average of 25 years’ experience in is to develop a portfolio that considers the the reinsurance marketplace. risk/ reward of the portfolio and, in particular, Pillar Capital is focused on providing the tail of the portfolio’s distribution. “We alpha to investors through the reinsurance Stephen Velotti, CEO and CIO believe the portfolio should be developed space. It aims to provide an attractive yield at Pillar Capital Management using the Omega Score. The Omega Score for investors while managing the risk it takes is an excellent metric for judging the risk/ to achieve its returns. Analysing the entire reward trade off and ultimately the downside market from the large reinsurance sector risk to the investor. Portfolio metrics are to the small ILW market and searching for evaluated utilising Pillar’s proprietary Pillar opportunities on the buy and sell side allows Risk Optimization System (‘PROS’) platform,” Pillar Capital to optimise the portfolio and explains Velotti. provide long-term compound returns. He says that a few of the key Deal access is a critical element of any characteristics that one should associate successful ILS manager. In that context, last with strong ILS managers are: having an year Pillar reviewed over 1,600 opportunities accurate portfolio of risk, managing the with an 87 per cent declination rate, with risk/return of the portfolio, and providing Velotti explaining that alpha is generated top class service to all associates in the from judiciously selecting the best securities space. Pillar’s success stems from its on such a high submission count, producing people, process and information, as well a more robust portfolio. as its disciplined underwriting approach, In his assessment of the ILS market last says Velotti. year, Velotti comments: “The ILS market Last year, the Cat Bond market was continues to grow as investor appetite for dominated by low coupon transactions with a non-correlating asset class with strong low multiples. returns increases. With the events in 2017, That trend has continued in 2018, with the ILS space has shown a spectrum of Velotti noting: “We are seeing the same or results as it has come to light what level of even more competitive pricing year-on-year. risk people where holding. Going into 2018 a As the Cat Bond market was not heavily number of good opportunities look to show affected from the 2017 loss events, we are themselves, specifically in the areas that seeing better opportunities in other sectors were loss affected.” of the market.” He believes that loss affected instruments On winning the award for Best ILS will offer the most attractive alpha Manager for the second year in succession, opportunities going forward, such as Florida Velotti remarks: reinsurance, Retro, etc. “The entire management team is excited As the increase of capital into the to receive this recognition. We believe this reinsurance has outpaced the increase in award comes on the heels of controlled reinsurance demand over the past 5 years growth of our AUM, and investor recognition the market has become more competitive. of our prudent and disciplined approach to However, post the 2017 loss events, in risk selection and capital preservation.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 36 The number-one independent private equity fund administrator is SS&C GlobeOp.

(Time to declare your independence.)

NUMBERS YOU CAN COUNT ON. ssctech.com

SSC-Hedgeweek-Awards-Report-Ad-MAR2018.indd 1 2018-03-23 1:24 PM SS&C GLOBEOP SS&C GlobeOp Best Global Hedge Fund Administrator

SS&C GlobeOp, a division of SS&C one of the most important considerations for Technologies, is one of the best-known fund managers, given the amount of middle- hedge fund administrators, servicing some office support that is now needed in the of the industry’s largest hedge funds. Year- current regulatory environment. on-year, the group saw its total hedge Sleightholme says that one of the most fund assets under administration rise from prevalent mistakes managers make is that USD584 billion to USD739 billion. they select an administrator based on Last year, SS&C GlobeOp saw increased immediate needs instead of looking at the demand for outsourced solutions driven long-term picture. Hedge fund managers, by clients looking to re-engineer their in his view, need to understand an operating models to create scalability and Ken Fullerton, Managing administrator’s ability “to access new markets, cost efficiency in the face of increasing Director, Global Co-Head asset types and fund structures, and provide complexity. This played to its strengths, of Hedge Fund Services at increased scope of services as the manager SS&C GlobeOp given the technology heritage of SS&C grows and looks to scale. “Oftentimes, Technologies and as Ken Fullerton, managers come to SS&C because they’ve Managing Director, Global Co-Head of ‘outgrown’ their existing provider.” Hedge Fund Services, explains: “SS&C’s Another common mistake is managers ability to create unique solutions built around ignoring technology capabilities. If a provider our proprietary technology, such as our cannot keep pace with today’s rapidly regulatory solutions product, GoTrade+, and changing digital economy, their business will middle office capabilities, allowed us to win suffer as a result. marque mandates from competitors, as “Lastly, cost pressures continue to drive well as large firms who outsourced for the the decision-making process which leaves first time. We also saw a high level of client managers with inadequate solutions and satisfaction from existing customers in 2017, Mike Sleightholme, Managing services,” states Sleightholme. He says that which is always a goal of ours.” Director, Global Co-Head over the last 12 months, SS&C GlobeOp One area of technology that SS&C of Hedge Fund Services at continued to win mandates across a “wide SS&C GlobeOp GlobeOp continues to focus on is artificial spectrum of strategies” including both mature intelligence, Fullerton confirms, as fund and emerging managers. administrators throughout the industry look Generally speaking, SS&C outperforms for ways to automate activities and tasks where complexity is a challenge for clients. that were once manually performed. “Being As Sleightholme comments: “Illiquid credit, able to automate mundane, administrative direct lending and closed-end fund mandates tasks will allow our staff to focus on higher continue to present significant opportunities value-add projects such as valuations, for us. Moreover, our deep expertise across reconciliation discrepancies and NAV all strategies and asset classes allows us to production/substantiation,” states Fullerton. provide a full range of services, regardless of To further illustrate SS&C’s commitment to fund and/or strategy type. This includes pre- technology innovation, it recently hired Rishi and post-trade compliance, loan servicing Khanna to oversee the group’s cloud-based and settlement as well as specialised fund alternative asset solutions. “Our ability to accounting services.” attract and hire innovative entrepreneurs and On winning the 2018 award for Best Global technology leaders will enable us to keep Hedge Fund Administrator, Fullerton says: pushing our technology solutions forward,” “We are very pleased and honoured to be adds Mike Sleightholme, Managing Director, recognised for this achievement. This is a Global Co-Head of Hedge Fund Services, true testament to our global workforce who SS&C GlobeOp. take much pride in servicing our clients and Selecting the right fund administrator is strive to be the best every day.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 38 AGECROFT PARTNERS Agecroft Partners Best Global Third Party Marketing Firm

Agecroft Partners was founded by Don billion in net new assets came into the Steinbrugge, who has 34 years of experience global hedge fund industry but the reality is, in the institutional investment management much of that capital is going to the biggest industry, including previously serving as the managers with the best brand names. head of sales for one of the world’s largest “Many investors get contacted by hedge funds and institutional investment thousands of hedge fund managers a year, management firms. of which they might interact with a few “Agecroft has changed the model of hedge hundred, organise follow-up meetings with 50 fund third party marketing,” says Steinbrugge. or so, and hire two. “Most third party marketing models are based “Anyone can be successful at raising on leveraging personal relationships and Don Steinbrugge, founder of money if they have three things: a high doing extensive entertaining. Ours has been Agecroft Partners quality product, a high quality marketing to build a global brand with a reputation as message and strong distribution. an industry thought leader, strong institutional “The managers that we work with rely on investment knowledge and representing high the Agecroft brand to help them. Our job quality managers” is to make sure managers articulate what Agecroft Partners has been a prolific writer their differential advantages are in a way of industry thought pieces and white papers, that closes the gap between perception and having written or appeared in more than 500 reality,” comments Steinbrugge. articles in the last few years. Often asked to A major issue for the hedge fund industry share their thoughts with the media on the is that even though there are a lot of great hedge fund industry, they have also been managers, many of them do a bad job a regular guest on Bloomberg Television of communicating what they do and as a and CNBC. consequence, perception falls below reality. “This has helped us to attract some of “If you can close that gap and identify the highest quality hedge fund managers to people who are particularly interested in represent and has also allowed us to access that manager’s investment strategy, it can many institutional investors that other third enhance the closure rate,” says Steinbrugge. party marketers have difficulty accessing,” “You have to give people a reason to states Steinbrugge. want to meet with you. Not being pushy, Last year was a good one for Agecroft, maintaining a high level of integrity, being which saw it bring in around USD1.4 billion very knowledgeable about the industry: these in assets for its clients with Steinbrugge are all important traits if you are hoping to confirming: “We were able to raise money meet the right people.” from a number of prominent pension funds, As Steinbrugge points out, this business family offices, consultants and endowments. is driven by brand. Most of the assets are We’re very happy with how 2017 played going to the largest hedge fund managers. out and pleased that we had a number of To that end, Steinbrugge says “we hedge funds that performed well and were take our brand very seriously. If we add in demand. a manager to our platform, it is important Some of these included CTAs, they rank well across each of the evaluation reinsurance, loan and fixed income strategies factors that we use.” that were able to provide diversified, On winning this year’s award a record uncorrelated returns compared to the seventh time in eight years, Steinbrugge broader market. remarks: “We are immensely proud to have According to Preqin, some USD49.5 been recognised by our peers.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 39 PurePrime Google it...

G L O B A L

CONTACT US: +61 2 9083 1333 • [email protected] • invast.com.au Invast (ABN 48 162 400 035) has an AFSL issued by the ASIC (No. 438283) which authorises it to carry on a financial services business in Australia. INVAST GLOBAL Invast Global Best Specialist Market Prime Broker

Sydney-based Invast Global is a subsidiary A second notable development was of Japanese listed Invast Securities Co the announcement in February 2018 that Ltd. Employing a prime-of-prime model, ex-Goldman Sachs and Citigroup Treasurer, Invast leads the industry in the provision Michael Cunningham, had agreed to join the of multi-asset high-quality, non-bank Prime Board of the company in Sydney in a non- Services. It provides credit intermediation, executive capacity. access to liquidity (both OTC and exchange) In addition to his financial markets roles and comprehensive trading platforms/API at Goldman Sachs and Citibank in Australia connectivity options. and Asia, Mr Cunningham also served as With a client base of brokerages and the Chief Risk Officer: Oceania Region for hedge funds spanning the globe, the Bank of Tokyo-Mitsubishi UFJ. His most Gavin White, CEO of Invast company has experienced impressive growth Global recent role was Partner in KPMG’s Financial in its prime services offering, which gives Risk Management Practise. institutional clients collateralised access “Michael is a heavyweight of the industry to premium liquidity in OTC FX, Metals and his knowledge and expertise is globally and Energy products, as well as direct renowned. His appointment is a real coup connectivity to over 30 global exchanges and for Invast Global and he will undoubtedly OTC venues. have a major impact on our future strategic “We named our facility PurePrime because direction,” comments White. it is the most transparent form of prime The Sydney office has 35 staff comprising services that a client can access without a 15 different nationalities. Having such diverse Tier 1 prime broker of their own,” explains language capabilities is a clear benefit that Gavin White, CEO of Invast Global. allows the firm to support its brokerage and “We have a relaxed but professional hedge fund clients across more than 20 culture. Everyone focuses on ensuring our countries. clients are well supported. It is that focus “Management is transparent about the and dedication that is the backbone to our company’s performance and staff have daily success. The Hedgeweek award is one of visibility to the key parameters of profitability. the most respected in the industry because This is important because most staff have of the peer-review methodology used. It is equity in the firm. a huge honour to win the award ahead of “That said, once you get through the other respectable nominees.” door of the office you are likely to be invited Already in 2018 there have been a couple out to our “Wintergarden” enclosed terrace of landmark developments. overlooking Sydney Harbour, where we The first was its confirmation as an have plush Chesterfield sofas and a limited- Official Partner to the Australian Men’s and edition “ACDC – Back in Black” 1970’s pinball Women’s Rugby Sevens teams. machine. This machine has proven very ”It is an exciting partnership,” says White. popular with visiting clients,” says White, “Rugby 7’s is one of the fastest growing whose primary motivation as CEO is to sports in the world, mainly due to its status empower staff “to achieve their dreams and as an Olympic sport. The athletes embody fulfil their potential”. many of the qualities Invast Global aspires On winning this year’s award, White to: Integrity, professionalism and world- remarks: “Winning the award is justification leading performance. But the partnership is that the risk was worth it and that the industry also about promoting other important values, values what we have built together. We such as equality, diversity and inclusion. have ambitious plans to expand further and The Australian Women’s team are current continue to solve the needs of the hedge fund Olympic Gold medallists.” industry with unique, high quality solutions.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 41 OPPORTUNITY IS KNOCKING IS 2018 THE YEAR HEDGE FUNDS ARE FINALLY GOING TO ANSWER?

What’s the Align differentiator? Our cost-effective Public Cloud offering is upending the industry de facto standard—one of the multiple Managed Cloud Solutions Align offers tailored to meet your firm’s needs. We help you achieve measurable business goals and keep your assets safe at prices that aren’t inflated. Why do we do it? Because IT is our passion, and our aim is to increase our client’s bottom dollar. Our subject matter experts bring industry-leading expertise to our award-winning work. What can we do for you?

Align brings over three decades of experience in award-winning services and comprehensive solutions. Align’s Managed Services offer end-to-end solutions, including: • Align Managed Private, Public & • Cybersecurity Advisory Practice Hybrid Solutions • IT Operations • 24x7x365 Service Desk Support • Subject Matter Experts • Real-Time Monitoring • Legal & Regulatory Compliance • Colocation Services • End User IT Support

See what Align can do for your business. 800-877-9980 (US & Canada) www.align.com and www.aligncybersecurity.com ALIGN Align Best Global Cloud Services Provider

For over 30 years, Align has been building Managed Public Cloud, availing of Amazon intelligent technology infrastructures, Web Services and Microsoft Azure, the Align networks and private clouds, in various Managed Private Cloud, for those wishing industries throughout the world. Over that to host their existing IT infrastructure within time, much has changed in the industry as the cloud, and as Paul refers to above, Align technology advances have re-shaped and Hybrid Cloud, giving clients the flexibility re-imagined what is capable in the world of to combine both public and private cloud fund investing. Speaking with Hedgeweek, resources in a multi-cloud environment. Vinod Paul, Chief Operating Officer of Align, “The Align Managed Private Cloud allows refers to two key milestones in 2017: companies to host their existing systems in • The company expanded its cybersecurity Vinod Paul, Chief Operating Align’s cloud environment, providing security, consulting practice with the launch Officer of Align resiliency and scalability. With regards to of Align Cybersecurity™, the first Align Managed Hybrid Cloud, we empower comprehensive risk management organisations to aggregate multi-cloud solution in the world. Our unique suite of resources, hosted across multiple public services encompasses solutions around clouds in a single view,” explains Paul. technology, compliance, risk management Knowing what the best cloud arrangement and security awareness education. should be will vary, manager by manager. • The company expanded its Managed In Paul’s view, it largely depends on a firm’s Services offering, with the addition size, scope and business model. Firms of Public Cloud solutions, which should choose the cloud option that best fits encompasses Office 365, Microsoft Azure their investment strategy, and they should and built-in cybersecurity features. select the cloud provider that addresses their With hedge fund managers increasingly unique business challenges. looking to outsource their IT infrastructure, “Align has been successful with deploying managed services, as a scalable, cost- a strategy that evaluates the requirements effective solution, has gained significant of each business and then creates the traction. Align’s NOC (Network Operations appropriate roadmap for each organisation to Centre) engineers work day and night to help move to its suitable cloud solution,” states Paul. hedge fund managers (and all other clients) In the past year, Align has been able to to eliminate risk, meet compliance standards successfully transform Managed IT Services, and scale their IT operations as business Cloud Services and Cybersecurity Advisory needs change. Services, introducing comprehensive Of course, the popularity of managed cybersecurity risk management to the market services has been facilitated by the significant and pioneering digital transformation. In advances made in cloud architecture. As Paul short, Align’s holistic approach gives clients comments: “Cloud services have become an end-to-end Managed IT and Cloud integral to the hedge fund industry. Services Solution spanning compliance, risk “With changes in regulation and increasing management, 24x7x365 support and more. investor expectations, the cloud enables As Paul explains: “The most important funds to keep pace and have a competitive aspect of Align’s cloud offerings is the edge in the market. Align continues to drive ability to deploy our multiple managed cloud innovation through embracing cutting-edge options, specifically designed to meet each technology and next-generation infrastructure, client’s individual and specific needs, with creating transformative and secure public, cybersecurity as a foundation from both private and hybrid cloud offerings.” a regulatory and investor due diligence Align’s Cloud Services include Align standpoint.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 43 FAIR OAKS CAPITAL Fair Oaks Capital Best Fixed Income Credit Strategy Hedge Fund

Fair Oaks Capital was launched in 2013 of mortgages from a single country. As a by senior professionals previously at result, managers typically focus on top-down, GSO Capital Partners and Apollo Global quantitative approaches based on macro Management. It characterizes itself as a factors. A CLO could be backed by 200 research-driven investment manager with corporate loans and it is key to be able to a focus on fundamental corporate credit review the individual issuers to assess the analysis. potential future performance of the deal. This “Our focus is to identify the highest requires different investment resources and conviction strategies in credit markets at any allows Fair Oaks to identify and benefit from point in time for our liquid and long-term market inefficiencies.” funds. We aim to offer investors differentiated Miguel Ramos, Partner at Fair Fair Oaks Dynamic Credit primarily invests opportunities which offer attractive risk- Oaks Capital in investment grade rated CLO securities and adjusted returns and low correlation with targets Euribor+ 4 per cent pa net returns, their more traditional positions,” explains offering a significant yield pick-up versus Miguel Ramos, Partner. investment grade corporate bonds. During Fair Oaks Capital’s first fund was 2017, the founding share class returned 5.89 launched in June 2014 as a listed, closed- per cent. ended vehicle which invests in control equity Ramos says: “Last year the Fund positions in collateralised loan obligations benefited from an active primary CLO (CLOs). Later, in September 2016, the firm market which recorded strong levels of new saw the opportunity to launch its more issuance, even though US CLO risk retention liquid strategy, Fair Oaks Dynamic Credit. As requirements were in place. the first UCITS fund focused on the global “The Fund deploys a defensive strategy CLO market, it offers an innovative way to as it invests in CLOs whose underlying gain exposure to European and US senior assets are backed by senior secured secured bank loans. corporate loans. The current portfolio The focus on CLOs as a high conviction includes more than 90 positions and 1,400 strategy over the last four years means that underlying senior secured loans. AUM has Fair Oaks Capital has built one of the largest grown to over EUR480 million.” and most experienced teams focused on CLOs are also floating rate instruments investing in this asset class. and are not exposed to interest rate risks, a In addition to the focus on fundamental key consideration at the current point in the analysis of the underlying loan portfolios, interest rate cycle in the US. the investment team includes specialists in Ramos adds: “The Fund was able to structured finance, documentation review enhance the carry generated in the portfolio and CLO manager due diligence. Being by purchasing investments where the team one of the largest investors in the CLO believed there was potential for additional space, Fair Oaks enjoys superior access to return via, for example, buying bonds at a investment opportunities in the primary and discount with high probability of an early call.” secondary markets. On winning this year’s award, Roger Other structured asset funds tend to focus Coyle, one of the Fair Oaks founders, on traditional ABS and RMBS, using CLOs as comments: “We are pleased for Fair Oaks diversifiers or sources of relative value. Fair Dynamic Credit to win the award. The Fund Oaks believes that CLOs are different given has performed well since its inception in the lower portfolio granularity and diversity in 2016 and we continue to see significant underlying credits. opportunity and value for investors in the “RMBS may be backed by thousands strategy.” n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 44 OVERVIEW

35 This illustrates how the vagaries of fund At one event I attended recently, I heard regulation can easily lead to unintended someone recall an anecdote about a misunderstandings and also underscore hedge fund COO who, when asked about the importance of selecting quality service cybersecurity, responded, ‘I don’t need to providers. Outsourced trading platforms such worry about, I outsource to an IT firm’. as JonesTrading are only too aware of these That would set the alarm bells off in regulatory developments, especially as MiFID any institutional investor. The merits of regulated entities will need to demonstrate outsourcing are myriad but any COO worth best execution is being achieved during the the salt knows that outsourcing any function, trade cycle. including cybersecurity, simply does not The team at JonesTrading handles mean that one can outsource their fiduciary all allocation, execution and any trade responsibilities. reconciliation. It tracks all of its outsourced As cyber attacks evolve, hedge fund trading clients’ execution performance with managers will no doubt continue to rely a third party TCA provider called Markit. on the expertise of cyber specialists but Indeed, JonesTrading has been recognised in they must ensure that the right culture and the industry for many years for its ability to mindset is fermented internally, from top provide best execution to clients, sharing the management downward. results of each execution on a T+1 basis. The biggest budget line item for the Aside from ongoing regulation, one issue SEC this year is for cybersecurity. It’s not that hedge funders will need to continue necessarily expensive to engage with third to monitor is the growing sophistication parties on this to have a plan. But you have of cybersecurity attacks. COOs have to to have a plan. be on top of this and put proper working 2018 promises to be another rollercoaster groups in place to run war room scenarios, ride for the hedge fund community. For all practice drills and test their disaster recovery the challenges that come their way, plenty of protocols. Once completed, they should be opportunities will arise. Those with an open documented, detailing what the outcomes mind, a can do attitude, and a willingness were and what steps were taken. to test new ideas – be it with new data sets, Simple fact is, investors expect this. They AI, hiring data scientists, etc – will continue are asking for evidence of DR and BCP in to flourish. And wonder what on earth all the their due diligence process. It’s not enough fuss was about. for a fund manager to say they have a WISP So good luck and congratulations to all of in place, or a cybersecurity program, they this year’s award winners and be brave in want to know how regularly it gets tested. your pursuit of excellence. n

HEDGEWEEK AWARDS Special Report Mar 2018 www.hedgeweek.com | 45