Hi Folks, long time. I hope your trading is doing well. I am in the process of getting 3rd party money to add to mine for trading my strategies and wanted to pick your brain or get some signposting of how to structure my investment pitchbook. It needs to convey the main points wihtou giving away the recipe and also demonstrate track record and scalabaility. Have you been through this process yourself? Or do you otherwise have tips on what to include and not include. Many thanks
In general, investors like to see a single page tear sheet showing P/L by month after fees from real trading with some basic metrics. Grab a few hedge fund tears sheets as a sample. The Pitch book, should include a bio for you and others in the company. A general description of your strategy, risk controls and an example of what you did in the past. Both the tear sheet and pitch books should have disclaimers.
Thank you very much for this answer, it is sooo helpful. Please can you signpost me to or otherwise provide samples / examples of what you said.
I can email you a few, but not here. I was looking to invest in some in 2022. I can send you those as samples. rmorse@lightspeed.com
If you need a 2nd response on this, I'm not sure you are ready for this adventure. I googled what he said and in under 45 seconds I had multiple examples. I would focus on taking the time to research online and figure out how best to present the information.
Hi there actuarial fun. Nice to meet a similar member of the small profession. How many years have you been practicing and in which area.
As well there are few videos on YouTube going into details what investors want. Currently market rates are so called 20+2, where 20 is 20% profit-split and 2 is 2% for management fees. But that's going rate for established funds with track record longer then x1 year. If one is nobody from nowhere upstart than one needs to offer lower rates than that just to enter into very overcrowded market. After a year or so. with a few happy clients under his belt, upstart can switch and claim he's not anymore and get paid like everybody else. But rates are can directly proportional to the reputation. The highest I've heard was 40% for a New York fund manager ( forgot his name, but he earned page on Wikipedia ), who was simply bribing business insiders to get business info before public. He got caught, but justice system let him go because he was such a nice guy and he made so much money for already very rich people.
I can't say I follow you. I'm currently an investor in 2 Hedge Funds. They are both 2/20. One has about $16mm in AUM and one well over $100mm. I have invested in a number of others. I look for low, steady returns. There are funds that charge 1/30, 1/40, 1/50. They have too much risk for me. If I was conformable with their risk, ALL I care about the risk vs return. If they can get me a 100% return after a 2/50, would I pay that that- yes. That should not be the focus. The focus should be consistent, risk adjusted returns, that satisfy the investor's needs. The fund needs to cater to their target market.
That's on the next level up. I was just trying to give some bearing to somebody who's just staring up.