Hatteras Funds, a provider of alternative investment solutions for financial advisors and their clients, has formed a partnership with private capital firm Portfolio Advisors to serve as sub-adviser for the Hatteras Core Alternatives Fund.
In 2003, Hatteras Funds created the Core Alternatives Fund to deliver the potential return enhancement produced by a diversified, seasoned evergreen private investment programme complemented by the risk mitigation benefits of a portfolio of hedge funds.
Hatteras Funds recently communicated with advisers and investors that the core fund’s sub-adviser change was a necessary step to improve the fund’s performance and fulfil its commitment to investors.
Hatteras Funds believes that by incorporating the purchase of secondary interests in private equity, private credit and private real estate funds as a key component to the core fund’s portfolio composition, the fund will be able to maintain a diversified evergreen private investment programme while minimising the j curve effect within the portfolio. To achieve this goal, Hatteras determined that it would be necessary to partner with an investment team who possessed demonstrated experience, depth, and industry relationships. Additionally, Hatteras believes the fund will benefit from more prudent and strategic utilisation of hedge fund strategies specifically designed to offer volatility dampening and liquidity management.
“We selected Portfolio Advisors to manage the private portfolio because of their strong long-term performance track record and deep experience across a breadth of private investment strategies. They possess both the experience, and the necessary relationships, to execute secondary investments successfully,” says Michael Hennen (pictured), head of investment management at Hatteras Funds. “Our focus has always been to provide financial advisors with alternative investment solutions that help build better portfolios for their clients.”
Portfolio Advisors or “PA” for short, was founded in 1994 and manages over USD36 billion of assets. PA is an independent, employee-owned firm that provides a full range of private equity, private credit and private real estate investment advisory and fund management services to sophisticated investors across North America, Europe and Asia. Given PA’s presence within the private markets’ arena, the firm has established relationships and access to top-tier fund offerings across private equity, private credit, and private real estate.
“We are excited to partner with Hatteras and believe we can deliver meaningful value to both advisors and their clients,” says Brian Murphy, managing director of Portfolio Advisors.
The partnership follows a series of strategic enhancements over the past year at Hatteras, including the November 2016 announcement that the firm plans to launch a series of evergreen private investment funds.
