Since the emergence of “Modern Portfolio Theory” and the “Capital Asset Pricing Model” in the late 1960s, institutional investors have taken a quantitatively driven approach to portfolio construction, looking to create portfolio diversification and obtain better risk-adjusted returns by balancing their asset-class exposures. This journey has seen several important advancements in thinking about how to optimally achieve desired results.
Funds that want to take the total portfolio approach first need to get the total portfolio view. To do that they not only need data – and lots of it – but a rock-solid understanding of exactly how they’re going to use it.
HCAP launches next single asset trust
(Pictured: Steve Howell)
HCAP Asset Management is opening its next, and fifth, single asset trust, called the South Brisbane Single Asset Trust, to investors on Wednesday for an offer close data of 11 June 2014.
The trust offers exposure to a residential development project and targets a substantial return of 25 per cent over 18 months, net of fees. The management fee is 2 per cent, and the administration fee is 1.3 per cent, for a minimum investment of $100,000.
The development is near the Brisbane CBD and is for a residential development project, called Fleet Lane, with 66 apartments with car spaces, and access to a 300 square metre roof top terrace.
HCAP’s first three single asset trusts, also within a three kilometre radius of Brisbane CBD, managed to deliver returns of 28 per cent, 25 per cent and 25 per cent, against targets of 20 per cent, within 18 months, on average, from launch of the respective development.
A Lane Cove Single Asset Trust was launched in April and another single asset trust will be launched in November for a residential development project in Pymble in Sydney.
As trusts that provide exposure to a single property development, the fund could be considered a unique mixture of a hedge fund and private equity.
HCAP founder, Steve Howell, has a long history in hedge funds in Australia, and was co-founder of Basis Capital.
