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Alternative Market Briefing

The benefits of permanent capital: Scalae Management up 30 % YTD from the flexibility to analyze and improve methodologies

Friday, October 24, 2008

From Kirsten Bischoff, Opalesque New York: New York-based Scalae Management, which was founded by Joseph Filicetti in July 2002, runs the CL Diversified Fund which trades a portfolio of futures across 65 markets. Filicetti recently spoke with Opalesque about the benefits the CL Diversified Fund has had, through the backing of its seeding partner, Trinidad-based Colonial Life Insurance Company.

History Colonial Life Insurance, which is a multi-billion dollar corporation with a business driven through insurance, financial services, beverages and petrochemicals, first reached out to Filicetti and Scalae when they were looking to open a US based capital markets group and launch a hedge fund. With $20m in seed capital from Colonial Life, Filicetti launched the CL Diversified fund, and his firm Scalae became the trading advisor to that fund.

The CL Fund has since grown to $30m and has been beneficial to both Colonial Life and Scalae. On CL’s part they have seen a return on their investment and as the fund grows, will see additional return streams as a fund partner. For Scalae, it has meant an infrastructure which most $30m funds could not afford so early in their existence, including a team of 4 people, offices in midtown Manhattan and “a relationship which gives us a great deal of staying power,” Filicetti said.

Strategy Permanent capital was very important during the early evolution of t......................

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