Creating and managing a portfolio of investment strategies

For wealthy clients, Alphatek Advisors provides services for creating and managing a portfolio of alternative investment strategies. Among the products offered are risk factor strategies, credit portfolios, foreign investment funds, real estate, and project investments within the framework of a GP / LP capital structure.

Traditional public equity market investment strategies (such as passive index investments in stocks / bonds) have a number of known problems:

• High volatility of stock indices, sharp market collapses
• Low global economic growth, interest rates and as a result low bond yields. In addition, with an increase in interest rates the prices of bonds will go down.
• Globalization, high speed of information dissemination lead to high market efficiency, difficulty in searching for undervalued assets, high cross-correlation of different asset classes and, as a result, to lower investor portfolio diversification.

As a result, high current valuations in the equity market and low interest rates in the debt market make it difficult to get yields in excess of 5-7% per annum with acceptable risks. Proposed solution is an alternative risk factor based investment portfolio. The key concept in this approach is to decompose the risk / return of an asset into subcomponents and to diversify the resulting portfolio not by asset class, but by risk.

Our team created a number of active risk factor strategies with high risk-weighted return (15% + return in dollars with 10% volatility of Smart Beta and Pure Alpha strategies), confirmed by 15 year tests and real work for four years. Alphatek is the first company in market that offers this type of strategy to a wide range of wealthy retail investors (investments from $100,000).

In accordance with the risk profile of the client, individual preferences and target indicators of profitability and liquidity of investments, as well as taking into account the cross-correlation of the proposed strategies, we draw up the optimal diversified portfolio of assets for the investor. Targeted return on such a portfolio is in the range of 5-25%, depending on the level of risk, currency and investment liquidity. The management fee for such a portfolio depends on the profit and size of the portfolio. Standard conditions - management fee 1.5% of AUM, success fee 20-25% of profits over 5-10% of the investor’s priority profitability.

In the area of ​​direct investment in existing business or new projects, investors are invited to participate in the GP / LP capital structure (General / Limited Partner) as LP partners with the ability to receive priority on the distribution of profits from the project. We participate as a General Partner and provide operational management of the project, as well as invest our own capital in the amount of 5-20% of assets, which guarantees compliance with the interests of the management team and investors.