Shift to alts: Fund offers wealthy clients easy access to hedgies

Private Advisors Alternative Strategies Master Fund invests directly in dozens of hedge funds
DEC 03, 2012
MainStay Investments is moving a little deeper into the alternative investments space with its new fund of hedge funds tailored to financial advisers with wealthier clients, as well as to smaller institutional accounts. The Private Advisors Alternative Strategies Master Fund invests directly in more than two dozen individual hedge funds and is structured as a continuously offered closed-end fund. MainStay, a New York Life Investment Management LLC company, manages $52 billion across 60 funds, but over the past few years, the company has undertaken a gradual move into the alternatives space; it now offers five such products. “In terms of alternative investments, we're looking at other areas of opportunity, and I think you'll hear more from us in the coming year,” said Stephen Fisher, MainStay Funds' president. Last month, MainStay announced that it had absorbed the $3.4 billion Marketfield Fund Ticker:(MFLDX) from Marketfield Asset Management LLC. The long/short equity fund has been renamed MainStay Marketfield. The newest alternative product will tap the expertise of New York Life affiliate Private Advisors LLC, which has $4.5 billion under management in hedge fund and private-equity portfolios. “We're trying to deliver a diversified portfolio of fundamentally oriented hedge funds,” said portfolio manager and Private Advisors partner Chris Mackay. The fund has a $50,000 minimum and is limited to accredited investors. According to the prospectus, the fund will be managed in line with an existing strategy that has been managed by Private Advisors since 2003. The prospectus shows that the strategy gained 5.6% this year through September, which compares with a 3.3% gain by the HFRI Fund of Funds Diversified Index. On a three-year annualized basis, the strategy gained 4.9%, while the index gained 1.7%. Portfolio Manager Perspectives are regular interviews with some of the most respected and influential fund managers in the investment industry. Please visit InvestmentNews.com/pmperspectives for more information.

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