The move from monthly to daily liquidity is something co-manager, and former Asian prop desk head, Mark Martyrossian feels confident about, with Tiger having paid out around $125million of its $150million assets, all on time, during the stressed conditions of late 2008 and early 2009. Through bull and bear runs, inflows and outflows, Tiburon’s team has been stable.
“We have always set great store by liquidity,” says co-founder and lead manager Mark Fleming, who ran Asian money for the British Airways pension fund before setting up Tiburon. Liquidity is in fact one of Tiburon’s primary risk management tools.
While Tiburon has experimented over the years with various types of hard stop losses at the position level, they prefer to exercise judgement in cutting losing positions, and sticking to liquid names allows them to do so frequently.
The “simple UCITS” exposure ceiling of 200% imposes no impediment, since Tiger was typically being run at much lower levels. Shorting synthetically, as opposed to borrowing stock, has not posed any problems either; but then Tiburon is always wary of “overcrowded shorts” in stocks that might also be more difficult to short synthetically.
The managers are “medium-term bulls of Asia”, citing its superior consumer, corporate and government balance sheets. Yet near-term they are sufficiently pragmatic to accept that Asian risk assets are correlated with risk appetite, something they feel is fragile at present.
“There isn’t as much cheap stuff as there was in June 2010,” says Fleming. This cautious stance does not stop the Taurus portfolio from maintaining a 39% net long exposure to equities.
However, whilst they fear formal estimates of beta adjusted exposure can be spuriously precise, the managers believe their book is broadly neutrally positioned. Long positions in dull utilities are lower beta than shorts in Hong Kong property and landlords.
In fact UCITS is not that new to Tiburon anyway: its largest fund since 2006 has been Taipan, a long only fund comprised of the long book of Tiger. The next UCITS launch planned will be named “Tang” and following the pattern set, will be the long book of the “Tao” mainland Chinese equity hedge fund.
Key details
Fund name: Tiburon Taurus Fund
Management company: Tiburon Partners
Promoter: Tiburon Partners
Status: Open
Inception date: 7th May 2010
Strategy
Kind of fund: Hedge Fund
Strategy group: Long/Short
Region: Asia ex-Japan
Asset classes: Equities
Particulars
Currency: USD, EUR, GBP
Share class name: USD Class A
Domicile: Ireland
Listing: Irish Stock Exchange
Fund structure: Investment Company with Variable Capital
NAV calculation: Daily
Liquidity: Daily
Notice (banking days): 1
Minimum investment: 15,000
Min. investment currency: USD
Income: Accumulative
Fees
Entry fee: 5%
Exit fee: 3%
Management fee: 2%
Performance fee: 20%
High water mark: Yes
Hurdle rate: No
Analysis
2010 return: 15.85%
Annualised return: 25.07%
Annualised volatility (monthly data): 12.25%
Sharpe ratio (2%) (monthly data): 1.88
Correlation to S&P 500 (monthly data): 88.15%
Correlation to iBoxx (monthly data): -29.23%
Service providers
Administrator: Northern Trust International Fund Administration Services
Custodian: Northern Trust Fiduciary Services
Auditor: PricewaterhouseCoopers
Lawyer: Dillon Eustace
