HOUSTON, May 30, 2013 /PRNewswire/ -- Salient Partners L.P. (Salient), an $18 billion asset management firm, has launched the Salient Alternative Beta Fund (Class A Ticker: SABAX, Class C Ticker: SABCX, Class I Ticker: SABFX).
The Salient Alternative Beta Fund ("the Fund") was created to seek long-term capital appreciation by investing in asset classes with low correlations to traditional stocks and bonds. The Fund primarily makes long and short investments in futures and forward contracts, but may also invest in securities, derivatives and other financial instruments in order to obtain extra diversification.
"Investors in alternative investment strategies have generally gravitated toward lower volatility investments that exhibit return patterns that are more correlated with traditional equity markets, but this fund goes against the grain by attempting to diversify away from equity-centric exposure while utilizing high volatility," said Lee Partridge, Salient Chief Investment Officer. "This is the latest step in our strategy to bring cost-effective and rules-based alternative investment solutions to a wide variety of investors."
The Fund tracks alternative betas, non-traditional market exposures based on chronic investor biases which can be used to generate potential return streams. Alternative betas, which include size, value, carry and momentum, may provide positive returns and diversification over the long term because they are liquid, scalable and differ from traditional market exposures.
The Fund, which offers a competitive annual management fee of 0.95 percent of its average daily net assets, targets a constant volatility level of 20 percent for the complete portfolio. To further balance risk across the portfolio, investments are evenly divided between divergent strategies, which can become negatively correlated to equities during increases in volatility, and convergent strategies, which can develop positive correlations to equities during periods of rising volatility. The Fund utilizes a quantitative systematic investment process which sets overall allocation based on how each portfolio sleeve interacts with the other sleeves.
"By obtaining the optimal balance between strategies that thrive in periods of turmoil and stability, we believe we have created a product that can potentially withstand all types of market conditions," said Mr. Partridge.
Mr. Partridge serves as Portfolio Manager of the Fund, along with Roberto Croce, Ph.D., Salient Director of Quantitative Research, and Bill Enszer, Salient Director of Investments.
For more information about Salient, please contact Chris Moon of Jennifer Connelly Public Relations (JCPR) at 973-850-7304 or [email protected].
About Salient Partners L.P.
Salient Partners L.P. is an $18 billion investment management firm based in Houston, Texas. The firm is a recognized innovator in the development, management and delivery of sophisticated, non-traditional investment solutions for both institutional and retail investors. Through its comprehensive investment approach, Salient identifies and develops leading strategies that help eliminate unrewarded risk, reduce investing costs and focus on the fundamental drivers of returns to deliver the full potential of all markets to investors. For more information about Salient and its professionals, visit www.salientpartners.com.
The Salient Alternative Beta Fund uses alternative investments as part of the Fund's investment strategy that are speculative and involve substantial risks.
The Fund's investment advisor (the "Advisor") is Salient Advisors, L.P., a wholly-owned subsidiary of Salient Partners, L.P.
The Fund is a newly organized open-end investment company and has limited operating history, including limited historical performance record, as such the Fund is subject to all of the business risks and uncertainties associated with any new business. The Advisor constructs a portfolio in which it attempts to balance the risk contribution of the risk premia or investment strategies in which it directly invests or gains exposure to. There can be no assurance that employing this investment approach will achieve any particular return or will, in fact, reduce volatility or potential loss. The Advisor relies heavily on quantitative models (both proprietary models and those supplied by third party vendors) and information and data supplied by third party vendors. Any decisions made in reliance on incorrect or incomplete models and data expose the Fund to potential risks. The Advisor's momentum strategy will have the effect of amplifying the Fund's exposure to assets whose prices have been rising and lessening the Fund's exposure to assets whose prices have been declining, which may result in more volatility than investments in broader cross-section of securities.
Investing in derivative instruments (such as options, futures, forwards or swaps) and commodity-linked investments can be riskier than traditional investments, and may be more volatile than investments in traditional securities. The value of commodity-linked investments may be affected by financial factors, political developments and natural disasters. The primary risks of futures contracts are the possible lack of a liquid secondary market, losses caused by unanticipated market movements, the Advisor's inability to predict correctly the direction of securities prices, interest rates, currency exchange rates and other economic factors, and counterparty default.
In addition, if the Fund has insufficient cash, it may be required to sell portfolio securities to meet margin requirements. Trying to enhance investment returns by borrowing money or using other leverage tools magnifies both gains and losses, resulting in greater volatility. Investments in foreign securities involve special risks not present in U.S. investments, such as currency fluctuations, lack of regulatory oversight and political developments. Investments in emerging markets are riskier than investment in more developed markets and are subject to risks related to currency, liquidity and volatility. These investments may be considered speculative. Investments in fixed-income securities generally are subject to an issuer's credit risk and risks resulting from changes in the general level of interest rates. Changes in tax laws or regulations, or interpretations thereof in the future, could adversely affect the Fund. Legislation could also negatively impact the amount and tax characterization of distributions received by the Fund's shareholders. The Fund may engage in other investment practices that may involve additional risks and you should review the Fund's prospectus for a complete discussion.
This does not constitute an offering of any security, product, service or fund, including the Fund, for which an offer can be made only by the Fund's Prospectus.
No fund is a complete investment program and you may lose money investing in a fund. The Fund may engage in other investment practices that may involve additional risks and you should review the Fund's prospectus for a complete description.
You should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. The prospectus contains this and other information about the Fund and is available, along with information on other Salient funds, by calling 866-667-9228 or from your financial professional. The prospectus should be read carefully before investing.
The Salient Alternative Beta Fund is distributed by Foreside Fund Services, LLC.
Fund shares are not FDIC insured, not bank guaranteed and may lose value.
SOURCE Salient Partners L.P.