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New Managers May 2013

Profiles - Stone Toro and Varden Pacific talk about their funds

 

Jeffrey Russo

Stone Toro Asset Management LLC, an asset management firm based in Princeton, New Jersey was formed at the end of 2009 by three ex-Merrill Lynch colleagues, Mike Jarzyna, Jeffrey Russo, and Richard Jenkins. Jarzyna and Russo were also directors at BlackRock, and Russo, the PM, managed more than $14bn in AUM as a Director there.

Their fund, the ST Alpha Event Fund, which was launched in January 2011, is an absolute return fund using a global multi-strategy approach to eventdriven arbitrage. It manages around $146.9m and is up 0.92% YTD (to March), after returning +2.5% in 2012 and +1.18% in 2011. It is also featured in Opalesque's EManagers database.

Jeff Russo actually started trading his strategy while at Bankers Trust in the mid-90s, where he served as portfolio manager of global developed and emerging market index funds with assets over $4bn (Bankers Trust at the time was the third largest index manager in the world, managing around $200bn worth of index related assets).

Russo defines "event" as things that are tangibly happening in the market. "So we like to look at where the world is, as opposed to the way we hope it to be or wish it was," he tells Opalesque.

The ST Alpha Event Fund has four distinct strategies, namely: index events, merger arbitrage, structural changes (or special situations, corporate actions) and relative value pairs.

"That's actually something that I think is a really attractive part of the strategy is the breadth of the index world and how the markets have changed over time," Russo explains. "The markets have become very passive with the emergence of ETFs. As active management on the mutual fund side has decreased in size, possibly due to active managers' long-term inab......................

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This article was published in Opalesque's New Managers a top-down monthly analysis, news and research publication on the global emerging manager space.
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