A data-driven approach to hedge fund investing
Seeded by the Eccles family, our quantitative framework incorporates the lessons of behavioral finance. We aim to deliver the highest and most consistent total returns possible—regardless of economic and market conditions—while minimizing the risk of loss.A portfolio of uncorrelated, systematic return drivers
Investors are human. And as markets shift, we tend to make emotional and impulsive decisions that sometimes lead to suboptimal investment performance. To counter this, we apply several uncorrelated quantitative models to portfolio management decisions, systematically deploying capital across long and short positions.
Our market-neutral strategy seeks to generate positive returns in every market environment, minimize downside risk, and add diversification in multi-asset portfolios by maintaining the following attributes:
Low correlation to stock and bond markets
Most investors have significant exposure to equity, credit and duration risk factors. Our design is to be a pure source of alpha that’s uncorrelated with major beta drivers in an effort to help our investors achieve better overall returns with lower volatility.
Equity-like returns
Our approach is intended to complement our investors’ portfolio allocations. Our strategy is calibrated to move enough that it delivers meaningful diversification benefits but not so much that it introduces unwanted volatility.
Minimal drawdowns
We maintain a large number of uncorrelated and positively-convex positions with upside potential that exceeds their perceived risk of loss. This feature aims to keep the depth and duration of drawdowns to a minimum even as the strategy targets outsized returns.
Low correlation to stock and bond markets
Most investors have significant exposure to equity, credit and duration risk factors. Our design is to be a pure source of alpha that's uncorrelated with major beta drivers in an effort to help our investors achieve better overall returns with lower volatility.
Equity-like returns
Our approach is intended to complement our investors' portfolio allocations. Our strategy is calibrated to move enough that it delivers meaningful diversification benefits but not so much that it introduces unwanted volatility.
Minimal drawdowns
We maintain a large number of uncorrelated and positively-convex positions with upside potential that exceeds their perceived risk of loss. This feature aims to keep the depth and duration of drawdowns to a minimum even as the strategy targets outsized returns.
Recognized Expertise
Brian Smedley is a Managing Director and Head of Cynosure Strategies. He manages the firm's hedge fund investment portfolio as the Chief Investment Officer. He previously held senior positions at Guggenheim Investments, Bank of America and the Federal Reserve Bank of New York.
Randal Quarles is the Chairman and Co-Founder of The Cynosure Group. Prior to forming Cynosure in 2014, he spent many years as a partner at the Carlyle Group and held senior financial policy positions in four different presidential administrations. He served most recently as Vice Chair for Supervision of the Federal Reserve Board of Governors.
