MainStay Investments, a Barron’s top fund family and a New York Life company, has launched the Private Advisors Alternative Strategies Master Fund and Private Advisors Alternative Strategies Fund.
The funds seek long-term capital appreciation above equity returns over a full market cycle with volatility that is lower than that of the equity market and returns that demonstrate a low correlation to both the equity and fixed income markets.
The funds are sub-advised by New York Life affiliate Private Advisors, the Richmond, Virginia-based fund of funds investment manager with approximately USD4.5bn AUM. MainStay Investments serves as the funds’ investment manager.
Stephen Fisher, president of the MainStay Funds, says: “Institutional investors and pension funds have long relied on alternative investments such as hedge funds to diversify their portfolios and achieve returns. Today, we’re seeing more and more demand among individual investors for investments that offer the benefits of hedge funds – long-term capital appreciation, less volatility and a low correlation to the equity and fixed-income markets – with more liquidity and flexibility.”
The funds are structured as “master-feeder” hedge fund of funds investment vehicles tailored to small-to-medium sized institutional investors and financial advisors for their accredited individual investors. The feeder fund invests substantially all of its investible assets in the master fund. The master fund invests primarily in private investment funds or hedge funds managed by third party portfolio managers. Investment strategies employed by the portfolio managers include global macro, credit, income, event driven, relative value and global long/short equity strategies.
Private Advisors is an experienced hedge fund of funds manager with an investment philosophy focused on wealth preservation and achieving strong risk-adjusted returns relative to other investments over time.
Chris Mackay, a partner at Private Advisors, says: “We are pleased to be partnering with MainStay Investments in offering investors this type of flexibility and access to our diversified strategies. We believe that the advantages provided by a registered vehicle that provides for a lower minimum investment threshold, more liquidity, the absence of performance fees at the fund of funds level and the convenience of the Form 1099 tax reporting, will provide an attractive option for many qualified investors.”