Natixis’ Sixtina platform checks compliance with investment guidelines every day, and also closely monitors liquidity. The platform provides institutional investors with a high level of monthly transparency, including stress tests and Value at Risk metrics as well as industry, sector and holding breakdowns. The suite of analytics used includes Bloomberg and Risk Metrics. More frequent portfolio snapshots can also be requested, and daily performance estimates are circulated as standard.
The offshore fund has averaged annual returns of 12.8% a year, whilst running average net long exposure of 47%. This figure has opportunistically and tactically ranged from as low as 1% to 89% and the fund has not lost money over any calendar year. Occasionally the manager buys puts on the S&P 500 index as a macro hedge, but the main focus is stock picking, and hard, absolute stop losses of 10-15% are applied at the position level.
Madison Street are contrarian, value-driven stock pickers with 70% of the book dominated by longer-term, buy and hold positions mainly in mid and large cap US stocks. This core portfolio is complemented by a more opportunistic higher speed trading book, which is also where the shorting takes place. This bucket utilises the skills of former options floor trader Charles Leone III. Co-founder Drew Hayworth has also traded options and equities in the past, on ETG’s prop desk, where he overlapped with the third portfolio manager and partner, Stephen C. Owsley. Leone and Hayworth are CFA charterholders. There are also three analysts and each of the six-strong investment team focuses on specific sectors and industries, producing proprietary research.
In its first nine months the UCITS has grown assets to $50 million, and Natixis has negotiated capacity of up to $250 million. So far inflows have been nearly all institutional, from insurers, pension funds and funds of funds. A retail share class with higher fees may be offered later. Madison Street was the first fund on the Sixtina platform, which has a strong pipeline of UCITS launches for the coming months.
Key details
Fund name: Sixtina Madison Street Fund
Management company: Madison Street Partners
Promoter: Natixis Asset Management
Status: Open
Inception date: 1st October 2010
Strategy
Kind of fund: Hedge Fund
Strategy group: Long/Short
Region: North America
Asset classes: Equities
Particulars
Currency: EUR, USD
Share class name: Class S EUR
ISIN: LU0533050166
Domicile: Luxembourg
Listing: Luxembourg Stock Exchange
Fund structure: SICAV
NAV calculation: Weekly
Liquidity: Weekly
Day (if not daily): Tuesday
Notice (banking days): 5
Minimum investment: 250,000
Minimum retail: 1,000
Min. investment currency: USD
Income: Accumulative
Fees
Entry fee: 0%
Exit fee: 0%
Management fee: 2%
Performance fee: 20%
High water mark: Yes
Hurdle rate: No
Analysis
Year to Date: 2.57%
2010 return: 4.29%
Annualised return: 9.71%
Annualised volatility (monthly data): 6.51%
Sharpe ratio (2%) (monthly data): 1.18
Correlation to S&P 500 (monthly data): 63.26%
Correlation to iBoxx (monthly data): 7.73%
