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On my last New York trip, I had the pleasure to meet some of the most noticeable new managers that were set up or seeded on the Proxima platform (formerly VegaPlus). This is my first report.
Jeffrey Talpins, founder of Element Capital Fund, finds that independence agrees with him. Since April 2005, when he launched his fund on the Proxima platform, it has returned over 14% with 6.25% volatility. Both May and June were positive, boosting YTD over 6%. And assets have grown, largely from earnings, to $340 million.
According to Jeff, as the Fed has been renormalizing policy, he has been positioning for more stability in the Fed Funds rate since the growth versus inflation trade-off is now more stable than it has been historically and the Fed Funds rate is now near the neutral level for the first time in seven years. Future Fed policy moves will probably not be as large as the 400 plus basis point hiking campaign of 2004 through 2006, or the 550 basis point easing campaign of 2001. Element has expressed this view by expecting that volatility on the front end of the curve will decline relative to volatility on the long end. Element’s investors have profited through 2005 and 2006 on its non-consensus call as the market had consistently implied a sharp increase in that relationship.
Element’s six person team aims to generate returns in all interest rate environments by both investing along their core macro views, as well as by actively positioning ag...................... To view our full article Click here
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