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The Torrey Funds 505 Park Avenue New York, NY 10022 U.S.A. (212) 644.7800

Consultiva Internacional, Inc. Third Annual Investment Management Conference Caribe Hilton Hotel San Juan, Puerto Rico Ricardo Cortez President, Private Client Group 15 November 2002. The Torrey Funds 505 Park Avenue New York, NY 10022 U.S.A. (212) 644.7800.

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The Torrey Funds 505 Park Avenue New York, NY 10022 U.S.A. (212) 644.7800

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  1. Consultiva Internacional, Inc. Third Annual Investment Management Conference Caribe Hilton Hotel San Juan, Puerto Rico Ricardo Cortez President, Private Client Group 15 November 2002 The Torrey Funds 505 Park Avenue New York, NY 10022 U.S.A. (212) 644.7800 The Torrey Funds (Europe) 40 Portman Square London W1H 6LT United Kingdom +44 (207) 947.8780

  2. Alternative Investments • Who employs them? • Individuals • Endowment Funds • Pension Funds • Others • Since when? • 1949: Alfred W. Jones created the first vehicle, employing a long/short strategy.

  3. Their Role in Asset Allocation Dollar-Weighted Asset Mix Alternative Investments 23% Cash/short term 1% InternationalEquities 14% Fixed Income 21% Domestic Equities 41% Source: Commonfund, 2001

  4. Two Different Long/Short Strategies • Long/Short Equity Style Investment • Variable Net Exposure • Securities and Sectors Selected for Out performance • Generally Only Long and Short Equity Investing • Seeks to Provide Enhanced Equity Equivalent Returns Market-Neutral Style Investment • Long/Short Equal Weighting • Securities Often Paired for Each Sector • Often Involves Bond Investments and Arbitrage Strategies • Seeks to Provide Enhanced Bond Equivalent Returns 1

  5. 6,000+ Universe 1st Screen 840 300 Candidates 50 Focus List 25 Finalists Portfolio 8-15 Altvest Hedegeworld MARHedge Prime Brokers Clients Hedge Fund Managers M O N I T O R I N G Torrey Associates, LLC – Manager Selection Database Searches Industry Contacts 2

  6. Inadequate Background Long Only Short Only Highly Levered Debt or Equity Extreme Use of Derivatives Quantitative “Black Box” Macro Foreign Exchange Torrey Associates, LLC – Manager Selection 6,000+ Universe 1st Screen 840 300 Candidates 50 Focus List 25 Finalists Portfolio 8-15 Screen Out Strategies M O N I T O R I N G 3

  7. M O N I T O R I N G Torrey Associates, LLC – Manager Selection 6,000+ Universe 1st Screen 840 300 Candidates 50 Focus List 25 Finalists Portfolio 8-15 Managers with a fundamental/analytical background and approach Documented experience at Short Selling Typical manager in first three years of own operation Low leverage Substantial portion of liquid net worth invested in fund Reputable service providers Potentially Interesting Candidates 4

  8. Definable investment “EDGE” Assess analytical capabilities Review risk management policies and implementation Minimum 10 years of investment experience Qualitative/Quantitative analysis Torrey Associates, LLC – Manager Selection 6,000+ Universe 1st Screen 840 300 Candidates 25 Finalists Portfolio 8-15 50 Focus List In Person Interviews By Principals Internal Review M O N I T O R I N G 5

  9. 6,000+ Universe 300 Candidates 25 Finalists 1st Screen 840 50 Focus List Portfolio 8-15 M O N I T O R I N G Torrey Associates, LLC – Manager Selection Reference Checks Due Diligence Checks Internal Analytics: Correlation and Portfolio Optimization Short List 6

  10. 6,000+ Universe 50 Focus List 25 Finalists 1st Screen 840 300 Candidates Portfolio 8-15 M O N I T O R I N G Torrey Associates, LLC – Manager Selection Portfolio Construction Selection of managers results in what Torrey believes is a well diversified portfolio 7

  11. Should seek to diversify portfolios by investment approach and risk exposure Diversification among investment approaches Generalists: Strive for a balance between value and growth Specialists: Each manager weighting generally limited to <= 20% Diversification of managers by risk exposure Net market Sector Style Portfolio Construction - Diversification 8

  12. y= -0.0356Ln(x) + 0.2729 R2= 0.6542 • Source: CrossBorder Capital, TASS Tremont Alternative Strategy Returns(Adjusted for “Survivor” Bias)By Age Decile, 1994-2000 9

  13. Incentive to Perform Generally Decreases as Fund Size Increases Hypothetical $50 million fund 20% Annualized Returns Year Assets Management Fee 1% of Assets Incentive Fee (20% of Appreciation) Fund commenced $50,000,000 - - 1 $57,500,000 $500,000 $2,000,000 2 $66,125,000 $575,000 $2,300,000 3 $76,043,750 $661,250 $2,645,000 4 $87,450,313 $760,438 $3,041,750 5 $100,567,859 $874,503 $3,498,013 6 $115,653,038 $1,005,679 $4,022,714 7 $133,000,994 $1,156,530 $4,626,122 Total Fees $5,533,400 $22,133,598 $27,666,998 This table is for illustrative purposes only and is based on the assumption of a hypothetical $50 million in initial assets, 20% annualized returns, 1% management fee and 20% incentive fee paid in arrears.  The table is a hypothetical presentation and cannot be read as a definitive/conclusive study.  There can be no assurances that actual fees and expenses will be identical to those of any actual fund. 10

  14. Incentive to Perform Generally Decreases as Fund Size Increases This table is for illustrative purposes only and is based on the assumption of a hypothetical $1 billion in initial assets, 0% annualized returns, 1% management fee and 20% incentive fee paid in arrears.  The table is a hypothetical presentation and cannot be read as a definitive/conclusive study.  There can be no assurances that actual fees and expenses will be identical to those of any actual fund. 11

  15. S&P 500 DRI The Torrey Development Fund, L.P. The Torrey Development Fund: An Example Five Years Ended 9/30/02 S&P 500 DRI The Torrey Development Fund, L.P. The Torrey Development Fund, L.P. The Torrey Development Fund, L.P. S&P 500 DRI S&P 500 DRI (i) Past performance is not necessarily indicative of future returns; (ii) Performance of The Torrey Development Fund, L.P. is net of all fees and expenses; (iii) Performance may differ based upon hot issue eligibility and individual dates of admission; and (iv) See Appendix A for more detail with respect to the indices used in this exhibit. 12

  16. Key to “Indexes 1 & 2” in Following Charts • 1. “Index 1” is comprised of 33.33% Russell 1000 Growth Index, 33.34% Russell 1000 Value Index, and 33.33% Russell 2000 Index. • “Index 2” is comprised of 25% each Torrey U.S. Strategy Composite, Russell 1000 Growth Index, Russell 1000 Value Index, and Russell 2000 Index. 14

  17. HYPOTHETICAL ASSET ALLOCATED PORTFOLIO TOTAL RISK REWARD ANALYSIS INDEX 1 VS. INDEX 2* 3 YEAR PERIOD ENDING JUNE 30, 2002 U.S. EQUITY ROR STD DEV ALPHA BETA R-SQUARED INDEX 1 -5.55 20.37 5.78 1.12 0.98 -0.30 18.76 9.58 1.02 0.97 INDEX 2 S&P 500 -9.18 18.00 0.00 1.00 1.00 6 More Return More Return Less Risk More Risk 4 4.158 90 DAY U.S. T-BILL 2 0 -2 -4 RATE OF RETURN -6 -8 -9.179 S&P 500 -10 -12 -14 Less Return Less Return Less Risk More Risk -16 -2 0 2 4 6 8 10 12 14 16 18 20 22 24 STANDARD DEVIATION * Past performance is not necessarily indicative of future returns. It should be noted that this represents Torrey U.S. Strategy Composite performance and does not reflect performance of an actual fund. See Appendix B for important disclosure related to the calculation of composite performance. See Appendix A for more detail with respect to the indices used in this exhibit. Please see Appendix C for statistical definitions. This is neither an offer to sell nor a solicitation to invest. Such offer or solicitation can only be made by a current Private Placement Memorandum. Risk Benchmark used for this analysis: S&P 500. RISK BENCHMARK USED FOR THIS ANALYSIS: S&P 500 18

  18. HYPOTHETICAL ASSET ALLOCATED PORTFOLIO TOTAL RISK REWARD ANALYSIS INDEX 1 VS. INDEX 2* 5 YEAR PERIOD ENDING JUNE 30, 2002 U.S. EQUITY ROR STD DEV ALPHA BETA R-SQUARED INDEX 1 4.12 20.81 0.69 1.05 0.95 7.95 19.07 4.09 0.95 0.93 INDEX 2 S&P 500 3.66 19.38 0.00 1.00 1.00 More Return More Return Less Risk More Risk 8 7 6 RATE OF RETURN 5 90 DAY U.S. T-BILL 4.453 4 S&P 500 3.663 Less Return Less Return Less Risk More Risk 3 -2 0 2 4 6 8 10 12 14 16 18 20 22 24 STANDARD DEVIATION * Past performance is not necessarily indicative of future returns. It should be noted that this represents Torrey U.S. Strategy Composite performance and does not reflect performance of an actual fund. See Appendix B for important disclosure related to the calculation of composite performance. See Appendix A for more detail with respect to the indices used in this exhibit. Please see Appendix C for statistical definitions. This is neither an offer to sell nor a solicitation to invest. Such offer or solicitation can only be made by a current Private Placement Memorandum. Risk Benchmark used for this analysis: S&P 500. 19

  19. HYPOTHETICAL ASSET ALLOCATED PORTFOLIO TOTAL RISK REWARD ANALYSIS INDEX 1 VS. INDEX 2* 8 YEAR PERIOD ENDING JUNE 30, 2002 (LIFETIME OF COMPOSITE) U.S. EQUITY More Return More Return 13 Less Risk More Risk 12.475 S&P 500 12 11 10 9 8 7 RATE OF RETURN 6 5 4.767 90 DAY U.S. T-BILL 4 3 2 1 0 Less Return Less Return -1 Less Risk More Risk -2 0 2 4 6 8 10 12 14 16 18 20 STANDARD DEVIATION ROR STD DEV ALPHA BETA R-SQUARED INDEX 1 11.61 17.88 -0.87 1.03 0.95 12.63 15.97 0.88 0.89 0.90 INDEX 2 S&P 500 12.48 16.99 0.00 1.00 1.00 * Past performance is not necessarily indicative of future returns. It should be noted that this represents Torrey U.S. Strategy Composite performance and does not reflect performance of an actual fund. See Appendix B for important disclosure related to the calculation of composite performance. See Appendix A for more detail with respect to the indices used in this exhibit. Please see Appendix C for statistical definitions. This is neither an offer to sell nor a solicitation to invest. Such offer or solicitation can only be made by a current Private Placement Memorandum. Risk Benchmark used for this analysis: S&P 500. 20

  20. Concerns • Talent • Liquidity • Transparency • Regulation • Suitability • Scalability 21

  21. Appendix A: Glossary Related to Indices Russell Indices Russell produces a family of 21 U.S. equity indexes. The indexes are market cap-weighted and include only common stocks incorporated in the United States and its territories. All indexes are subsets of the Russell 3000® Index, which represents approximately 98% of the investable U.S. equity market. Russell 2000® IndexMeasures the performance of the 2,000 smallest companies in the Russell 3000 Index, which represents approximately 8% of the total market capitalization of the Russell 3000 Index. As of the latest reconstitution, the average market capitalization was approximately $490 million; the median market capitalization was approximately $395 million. The index had a total market capitalization range of approximately $1.3 billion to $128 million. Russell 1000® Growth IndexMeasures the performance of those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values. Russell 1000® Value IndexMeasures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values. S&P 500 DRI Index The S&P 500 is the Standard & Poor’s 500 stock index. It is an unmanaged market-value weighted index of 500 stocks selected to provide a broad indicator of price movement in the U.S. stock market. All dividends reinvested. S&P 500 Index The S&P 500 is the Standard & Poor’s 500 stock index. It is an unmanaged market-value weighted index of 500 stocks selected to provide a broad indicator of price movement in the U.S. stock market. MSCI EAFE Index An unmanaged capitalization weighted index that monitors the performance of stocks from Europe, Asia, and the Far East (11 countries total) and includes the reinvestment of dividends.

  22. Appendix B: Disclosures Please note that in reviewing the performance information contained in the charts relating to Torrey U.S. Strategy Composite: (i) The performance of Torrey U.S. Strategy Composite is not the performance of an actual fund. The composite represents the performance of all Torrey-affiliated investment vehicles during the relevant period that employed a U.S. investment strategy that is substantially similar to the strategy expected to be employed by Torrey U.S. Strategy Partners; (ii) The composite performance has not been verified by a third-party and does not comply with the standards established by the Association of Investment Management and Research (AIMR); (iii) The performance of the composite may future affect its performance was calculated net of fees and expenses of each investment vehicle. The estimated fees and expenses of Torrey U.S. Strategy Partners are expected to be less than the actual fees and expenses of the investment vehicles included in the composite; (iv) Potential investors in the offshore funds should consider that the performance may differ based upon legal eligibility to participate in “new issues”; (v) Performance for hedge funds in the composite for the year 2001 is generally unaudited and may be subject to change upon final audit.

  23. Appendix C: Statistical Definitions Alpha Measures the relationship between the fund performance and the performance of another fund or benchmark index and equals the excess return while the other fund or benchmark index is zero. Beta Measures the systematic market risk and is equal to the change in fund performance in relation to the change in fund or index performance. R^2 (R-Squared) The R^2 coefficient measures the extent to which the performance of the fund and the performance of another fund or benchmark index are related. More specifically, the R^2 coefficient measures how much of the funds variability can be explained by the performance of the selected fund or benchmark index. R^2 values should always range between 0 and1. R^2 values close to 0 indicate a minimal relationship between the performance of the fund and the performance of the fund or benchmark. R^2 values close to 1 indicate a strong relationship the fund performance and the performance of the selected fund or benchmark. Standard Deviation(a measure of volatility of returns): A statistical measure of risk which represents the variability of returns around the mean (average) return. The lower the standard deviation, the closer the returns are to the mean (average) value. Conversely, the higher the standard deviation, the more widely dispersed the returns are around the mean (average). Source: Altvest/ Investor Force

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