ORTON, Scotland (HedgeWorld.com)–Valu-Trac plans to launch a tactical asset-allocation alternative investment strategy in March in an offshore master feeder structure.
For now the firm, which specializes in long-only mandates and in producing monthly asset allocation advice to institutional investors, is managing the alternative investment strategy in a proprietary account. The new fund, Valu-Trac Strategic Master Fund Ltd., will cater to that same institutional investor base, which includes insurance companies, funds of funds and securities companies.
The strategy is global macro/tactical asset allocation and will invest in 42 different markets and four asset classes. Splitting the fund’s holdings between equities, bonds, currency and commodity asset classes, officials are planning to add to its long-only repertoire.
Unlike other trend-following global macro strategies, the Valu-Trac fund looks at the actual value of the investment and the behavior of that intrinsic value, rather than the trends in prices, said Michael Gould, appointed representative of the fund.
The portfolio also has a low correlation to established global macro and managed futures indexes. The investment adviser to the fund, Valu-Trac Investment Management Ltd., is authorized by the U.K.’s Financial Services Authority and is registered as a commodity trading adviser since the portfolio is executed through futures and forwards. The firm is also a Securities and Exchange Commission registered investment adviser.
R. Peter W. Millar, based in Scotland, is the chief executive and principal of the firm and the portfolio manager for the Cayman-domiciled hedge fund. Mr. Millar was the founding senior investment manager of the Abu Dhabi Investment Authority before founding Valu-Trac in 1985. In London, Peter Hart will be leading the firm’s alternative investment effort, while James Dempster is the head trader for the fund in Scotland.
The investment minimum for the Valu-Trac Strategic Master Fund Ltd. is set at US$1 million with monthly redemption and no lock-up period. Friends and family and the firm are expected to provide US$10 million in seed capital. Service providers for the fund will be: J.P. Morgan as prime broker; Sidley & Austin, legal counsel; and DPM, fund administrator.