Best Absolute Return Currency Specialist - USA
Capital Management LLC
Principal: Bill Lipschutz
Hathersage Capital Management is a global macro investment manager specializing in G10 currencies – absolute return, not portfolio hedging, is the sole focus. Offered through Deutsche Bank’s dbSelect Platform, Hathersage’s flagship investment vehicles are up +66.46% and +15.87% gross over the past twelve months.
In managing assets for pension funds, private banks, endowments, fund of funds, family offices and select high net worth individuals for nearly twenty-five years, the Hathersage team has consistently produced both strong absolute and strong risk-adjusted returns.
The strategies offered by Hathersage express macro themes that are based on such drivers as momentum, a fundamental analysis of economic relationships, political events and financial market expectations. The firm takes both tactical and strategic directional market views in G10 currency pairs using interbank spot, forwards and options. The trading approach is discretionary.
Financial markets are uncertain and ever-changing. It is vital to stay close and react quickly.
Process is essential.
A substantive, repeatable process ensures profit maximization on good trade ideas and loss minimization on those views that do not work out as anticipated. Great trades are important, but rare, and simply relying on an ability to consistently generate great trade ideas is unlikely to prove successful over time - this is why process is so important.
Hathersage combines bottom-up trade idea generation with top-down risk management.
Utilizing a wide range of market data and analysis, the PM team identifies medium and long-term themes, and then constructs and manages a portfolio of trade ideas so as to deliver performance within a well-defined risk mandate.
Hathersage generates true alpha: persistent returns that are not correlated with either equity beta or market sector (FX) return factors such as carry, trend, value and volatility.
Since inception, the firm’s strategies have demonstrated superior returns through a variety of different economic and market conditions, with particular success during periods of extreme market (global equity) dislocation.
What Sets Hathersage Apart
Hathersage is a highly experienced and dedicated currency-only manager.
The ability to adapt to changing market conditions, drivers and events and understanding when and what is an acceptable risk/reward defines a superior discretionary manager.
The firm maintains a moderate-sized, flexible operation that is well-positioned to capture opportunities in a highly liquid and particularly rapidly moving market sector.
All aspects of Hathersage’ s functional area structure: risk management, operations, information technology, and compliance, have been built around monitoring markets and positions on a continuous basis. At all times, exposures and opportunities are being considered by a team who has been fully dedicated to currency management from inception.
Global financial markets are in the early stages of normalizing.
We first wrote of this to our investors in September 2013, stating that because G10 FX is highly liquid and because exposures can be scaled quickly, Developed Market (DM) currencies would be one of the first market sectors to reflect this cyclical turn.
With normalization and thus, currency realignment not a question of if but of when, we further wrote in May, and then again in December of 2014, that we saw no alternative but a return to the free market movement of capital and that, although this cycle could ultimately unfold over half a decade or more, the initial price changes were likely to be both rapid and large.
Throughout 2014 and 2015, driven by a growing market realization that divergent central bank monetary policies and relative real interest rates were in play, the incipient leg of this necessary large and fundamental realignment in currency pairs began and has now firmly taken hold.
A continuation of this move over the next few years will likely provide discretionary G10 FX managers such as ourselves with extraordinary investment opportunities.