Highland Funds, managed by Highland Capital Management, has appointed Cummings Bay Capital Management as the sub-adviser to the firm’s Healthcare Fund.
Highland has changed the fund’s name to the Highland Long/Short Healthcare Fund in connection with changes to the fund’s investment strategy.
The fund will be managed by Michael D. Gregory, who has ten years of experience with long/short equities strategies in the healthcare sector. Previously, Gregory launched Cummings Bay Capital, a long/short healthcare hedge fund, and was a partner at Sands Point Partners where he managed a long/short healthcare-focused fund.
"Michael significantly enhances Highland’s considerable expertise in the healthcare sector, bringing us a unique understanding of the financial, scientific, and policy elements critical to successful investing in this space," says Joe Dougherty, partner and head of retail products at Highland. "In addition to Michael’s experience and prowess in healthcare investing, we believe he has demonstrated a strong history of performance and risk management in applying a long/short investing strategy to this sector. Michael’s long/short strategy is well-suited to the unprecedented opportunities and significant uncertainties in healthcare today and Highland is extremely excited to be offering investors the only long/short healthcare mutual fund available."
The tund seeks long-term capital appreciation. It will generally take long and short positions in equity securities and will vary the fund’s long-short exposure over time based on market conditions and other factors. The fund will invest across all sub-sectors of the healthcare industry, using a top-down, theme-driven approach to identify areas of opportunity where the fund has a view that differs from the consensus and then applying bottom-up analysis to identify stocks that represent opportunities within these themes.
"This healthcare reform legislation is the largest structural change to healthcare in America since Medicare and Medicaid in 1965. The implementation of this reform creates a new investment cycle in which investors can take advantage of low valuations coupled with improving business clarity in the healthcare sector. In addition to the new opportunities created by reform implementation, certain healthcare companies will face significant challenges and reimbursement headwinds, thus making a long/short strategy particularly relevant to this sector at this time," says Gregory.
Highland will continue to serve as investment adviser to the fund.