Experience & Long-term Results Underpins Zenith’s ISAM Systematic Fund ‘Recommended’ Rating

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Zenith Investment Partners Pty Ltd (Zenith) Head of Alternatives Research Daniel Liptak has announced that International Standard Asset Management (ISAM) Systematic Fund has received a RECOMMENDED rating.

With offices in London and New York, ISAM was founded by Stanley Fink, former CEO of the Man Group, in July 2008 to provide alternative investment strategies to institutions, family offices and private individuals.

When Stanley Fink joined Man, the organisation was a medium sized private company, largely focusing on agricultural commodity trading, with small operations in futures broking and hedge fund management. By 2008, when Stanley left to join ISAM, Man had a stock market capitalisation of $20B and managed alternative assets approaching $80B.

ISAM CEO Stanley Fink and his senior management team have established long term track records in the fund management industry and collectively bring decades of hedge fund experience to the Firm.

In February 2010 ISAM formally announced a strategic alliance with Hite Capital Management (HCM), the hedge fund firm founded by renowned systematic trading authority Larry Hite. The new venture resulted in Larry Hite and his key senior managers Alex Greyserman and Gilbert Lee becoming shareholders in ISAM.

The immediate benefit for ISAM was access to the Hite investment program that is now the Fund that was the subject of Zenith’s review.

Larry Hite and his team developed and refined the Fund’s strategy over the last 30 years, initially at Mint Investment Management Company and then at Hite Capital Management. For 15 of those years Mint had a successful joint venture with Man Group.

This period occurred during Stanley Fink’s tenure at Man.

“The ISAM Systematic Fund uses a combination of trend following and other quantitative investment techniques for currency and futures markets,” said Daniel Liptak. “The system operates 24hrs a day with trades generated automatically with pre-defined stop / loss orders in place.”

The investment objective of the Fund is to achieve capital appreciation through active management using purely systematic trend following models. The strategy seeks to capture profits from market price trends using a rules based platform.

The program has evolved over the last 30 years and is continually monitored and refined.

Today, the systems are applied to over 50 global financial and commodity futures markets and forward currencies.

The Fund targets a return of 15 – 20% per annum with volatility in the same range.

Daniel Liptak added, “For the purpose of Zenith’s review, the Alternatives Team have incorporated the track record of the Hite Futures Strategy and the performance of the Fund since inception.”

“As a result we have data back to June 2001, with an observed volatility of 19.34% with an annualised return of 18.27%, providing evidence that the program can be profitable, but not without risk.”

Zenith believes the strength of the Fund comes from the stability of the team that has built the investment program, the purity of its approach and, given the Fund’s AUM – the ability to follow trends in markets, such as commodities efficiently.

In addition to this, the partnership of Fink and Hite was successful in the past at Man Group and enhances Zenith’s confidence in the management of the business.

“Zenith is confident that the Manager clearly has identified trends and noticeably is able to efficiently and profitably trade them in a risk aware manner. The Manager does not dilute or smooth out the investment process with a broader range of investment strategies designed to reduce risk,” concluded Daniel Liptak.

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