Opalesque Industry Update, for New Managers - CTA specialist RPM and asset manager Privium Fund Management are set to launch a new fund for Dutch
investors. The “Evolving CTA Fund” provides exposure to a portfolio of largely untapped smaller and innovative
CTA managers across three sub strategies: trend-following, short-term and fundamental. The fund is developed
in response to growing concerns over asset concentration and deteriorating returns from very large and well known
RPM Risk & Portfolio Management has roughly $4bn in funds under management and advisory. RPM concluded, based on thorough research, that CTAs in their “evolving phase”, are the most promising from a risk/return perceptive. These CTA’s are typically between two to seven years of age with $30million to $2billion in AuM – depending on investment strategy. Historically, Evolving CTAs have outperformed their larger peers by 3% per year at an equal 10% volatility, the RPM study found.
The fund will be benchmarked against the Barclay BTOP50 index, which tracks 20 of the largest and most wellknown CTAs. The fund will be domiciled in The Netherlands and will invest in the Luxembourg-based RPM Evolving CTA Fund (SICAV) It offers daily liquidity, a unit size of 1.000,- with a minimum subscription of Euro 25,000.- and is managed by AFM regulated investment manager Privium Fund Management. Investors will have full web based transparency on: risk, returns, underlying managers, exposure levels and more.
RPM's CEO Mikael Stenbom commented : "We seek to identify and invest with CTAs who demonstrate potential to develop into the next generation of industry leaders. The aim is to find them before they become too large, or too old, to maintain the level of return that typically occurs during the first 2-7 years of a CTAS existence. The fund is the result of a research work that began in 2010 and that can be best described as a systemization and verification of the experiences we have made during our twenty years as investors and risk manager of CTA world.
Clayton Heijman, director of Privium Fund Management commented: “Today's large and well-known CTAs were unknown to most investors when their performance was at its most competitive. The "Evolving CTAs" have demonstrated a unique expertise and ability to generate returns, in many cases with new, innovative ideas and methods.
An asset manager develops like most other companies: a start-up phase followed by a growth phase with
strong competitiveness. As they move into maturity, their competitive edge gradually deteriorates. A few have
the ability to renew themselves, others fade away. Unfortunately, most investors are attracted to them at the
peak in their life cycle. This fund focuses on managers that have entered into the growth or “Evolving” phase.