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Investment Objective

At HedgeFundLive.com, powered by TFG Trading Matrix, members have the opportunity to watch and hear a hedge fund trade and operate in real time.  The investment objective of the Fund is detailed below.

The hedge fund (“the Fund”) will generally seek to achieve superior total returns through a unique blend of innovative business management and synergistic trading styles.  The business infrastructure should allow the traders, strategists, and managers to operate in an environment of Collective Intelligence.  The managers may utilize a diverse group of specialized investment strategies and invest the Fund’s assets in a wide variety of securities and other financial instruments, including, but not limited to, common and preferred stocks, bonds and other debt securities, convertible securities, limited fund interests, mutual fund shares, options, warrants, commodities, futures, derivatives (including swaps, forward contracts and structured instruments), currencies, monetary instruments, cash and cash equivalents.

 

Portfolio Construction

The Fund’s overall portfolio will generally be constructed to make the movement of capital as efficient as possible within multiple strategies.  All positions within the independent strategies will generally be optimized by the intra-day pivot, momentum, and futures trading groups.  Idea-generation will originate from an individual manager with discretion to engage in a limited position.  Each idea will then be fleshed out in a cyber environment in which all members of the trading groups will be able to provide input.  A risk-reward analysis will be completed by the Risk Manager in conjunction with the Chief Market Strategist and Business Manager.  Established positions will be actively traded on an opportunistic basis.   

Generally, strategy selection and portfolio construction are a function of both qualitative and quantitative considerations.  Qualitatively, the General Partner must believe that the underlying thesis of each strategy has the ability to generate excess returns and that the managers have the experience, intellect and resources to extract those returns.  Quantitatively, the General Partner brings together multiple managers in a construct that allows continuing additions of strategists to leverage the preexisting manager capabilities.  Efficient use of capital and proper economic incentives allow for a scalable pool of managers.  By creating a formal training program for junior personnel, future managers will be trained to adapt to the singular culture and forge their own strategies.  Managers, traders and strategists will generally be reviewed openly on a daily basis, and more formally on a monthly and quarterly basis.  The General Partner’s investment philosophy allows it to be flexible enough to react rapidly and decisively to the challenges and changes within today’s markets. 

 

Manager Sourcing

The managers within the Fund will typically have a preexisting relationship with the senior partners.  Deep due diligence and background checks will be conducted in order to assure that the communicative balance between all members of the firm is not disrupted.  It is a business imperative to not contaminate the communal process of the group with inappropriate Managers or strategies.  All managers must be task-oriented and strong communicators.  They will be chosen based on their general standards, moral compass, work ethic and integrity.   All managers must have the ability to function independently, but, more importantly, as a team member, contributing to the overall success of the Fund above the specific return on their respective portfolios.  It is important that managers maintain extensive networks within the business community and open those relationships to all members of the firm.  Their distinct investment talents must be proven over years of learning and executing successful strategies.   Managers will generally be chosen because they want to be a part of the distinct culture embodied by HedgeFundLive.com and to make money.  Managers will choose to join HedgeFundLive.com’s team because it is an environment in which they believe their potential can be realized.  This selective process will enable the General Partner as a whole, the Fund’s returns, and the content broadcast on HedgeFundLive.com to be elevated to higher levels. 

 

Portfolio Managers

The managers will generally identify companies that they believe are trading at a discrepancy to the intrinsic value of the entity and then employ a bottoms-up fundamental analysis to ascertain the risk, reward, and catalysts for each prospective position.  A highly diversified portfolio of the best long and short ideas will be constructed and actively traded.  The managers will generally utilize the Equity Trading Group to enter, trade, and exit positions.  The Portfolio Management Group will be diversified and hierarchically structured to allow for maximum scalability.

 

Equity Trading

The Equity Trading Group includes the pivot point strategy headed by Mark Moskowitz and the momentum strategy.  This group will generally employ a purely technical short-term and intra-day trading strategy.   Entry and exit levels will be determined by applying pivot point calculations in conjunction with moving averages to confirm resistance or support levels of stocks.  Additional technical analysis tools, such as candlestick patterns and tape reading, may provide further opportunities.  Generally, short-term trading requires strict discipline and adherence to predetermined risk-reward ratios.  This strategy is indifferent to market direction.

 

Futures Trading

The Futures Trading Group will generally manage an uncorrelated macro futures trading strategy primarily focused on U.S. equity indices.  Some liquid fixed income and commodity futures may be utilized on an opportunistic basis.  Trading will be short-term and high frequency.  Minimal overnight risk will be taken.  Catalysts, such as economic releases, quarterly earnings season, and regular central bank announcements, may provide additional trading opportunities. 

 

Risk Management

The Risk Management Group will generally be independent of the traders, managers, and strategists, who adhere to their own self-imposed risk management procedures.   Real-time monitoring of and proactive involvement in the portfolio construction and daily trading activity help create tighter controls.  The Fund’s risk management is unique in that it will be an integral part of the investment process from beginning to end.  Typically, risk management is a monitoring process appearing too late in the investment process.  The Fund’s risk management will generally be ongoing and interactive, reaching into all business protocols and investment activities.  Risk management will be focused on capital allocation and loss controls.  A consistent set of rules will be applied to each individual trader and manager.  Controls and rules will be enforced through technology overlays, as well as constant real-time direct monitoring by the group.  All trading will be conducted through a single electronic trading platform.  No opportunity for unauthorized trades will be tolerated.  Traders will not generally have direct contact with the brokerage community.  As an autonomous group, risk management will contribute to idea generation, portfolio construction and trading parameters.  The Fund’s portfolio will be viewed as a singular portfolio consisting of multiple portfolios, and each strategy will be monitored as a separate self-contained book.  As such, capital will be rigorously apportioned to the appropriate strategy in real time.  Business protocols will be strictly adhered to and developed in concert with the Fund’s risk management discipline. 

 

Business Management and Capital Allocation

The overall business infrastructure will be managed through a combination of entrepreneurial acumen and proven institutional process and structure.  By creating a singular culture, all team members should be motivated by the same guiding principles.  All senior professionals will have equity in the Fund and HedgeFundLive.com.  The business model is designed to promote the type of collaboration that results in improved performance and idea generation.  By creating a strong business foundation and infrastructure, the Fund hopes to create a long-term consistent revenue stream for its investors.

Now that you have read the investment objective of the multi-strategy hedge fund broadcast by HedgeFundLive.com, we hope you will join us for our daily broadcast, weekdays from 7:45 AM through 4:15 PM EST.