By DailyAlts Staff
Discretionary macro is a subset of the broader global macro category of investing, which also includes systematic macro strategies and managed futures. In contrast to the latter two categories, discretionary macro managers utilize a fundamental approach (vs. systematic) to deploy their investment decisions across and within asset classes, going long or short with a top-down view. Of all macro strategies, discretionary macro provides the most flexibility - and that's the feature many investors feel they need with the near-term outlook for financial markets so uncertain.
In response to this demand, Balter Liquid Alternatives launched the Balter Discretionary Global Macro Fund on May 28. The fund, which seeks to generate positive absolute returns in most market conditions, pursues its investment objective by employing a "global macro" strategy across a diversified array of investment styles, strategies, and asset classes.
Balter's Second Fund
The Balter Discretionary Global Macro Fund follows in the footsteps of Balter's first mutual fund, the Balter Long/Short Equity Fund (MUTF:BEQIX). Through the end of May, the fund's year-to-date returns of 3.78% ranked in the top 25% of Morningstar's Long/Short Equity category.
"The Balter Discretionary Global Macro Fund is our next step in offering compelling alternative mutual funds which allow investors the ability to access hedge fund strategies in a format that seeks to help solves tax, transparency and liquidity issues for the investment community," said Mr. Balter. "We strive to bring high quality hedge fund offerings to the mutual fund market."
Willowbridge Associates is the fund's sub-advisor and day-to-day manager of the global macro strategy. The firm was founded in 1988 and is a registered commodity pool operator and CTA. And, not unlike other similar funds, up to 25% of the fund's assets will be allocated to a wholly owned Cayman subsidiary of the advisor that simply allows Willowbridge to gain exposure to certain commodity investments and remain within IRS regulations.
Balter's Brad Balter, Jay Warner, and Ben Deschaine are listed in the fund's prospectus as portfolio managers, along with the sub-advisor's Philip Yang and Franc Marrapodi. Mr. Yang and Mr. Marrapodi will utilize Willowbridge's "wPraxis Trading Approach (1x Leverage)" strategy.
"The Fund builds on our philosophy of making great managers available to a wider audience", said CEO Brad Balter. "We believe that hedge fund industry dynamics have led to many managers with great records being overlooked by the broader investing public."
Category and Performance
Morningstar doesn't have a "global macro" category, which would be the most appropriate category for the fund, and thus classifies the Balter Discretionary Global Macro Fund in its Multialternative category. Even still, the fund would more appropriately be categorized in the managed futures category.
Performance for Willowbridge's wPraxis Trading Approach (1x Leverage) composite dates back to May 2008, according to the prospectus. The composite has seen positive performance in each full year since 2008, as well as the partial years of 2008 and 2015, as seen in the table below (see column titled "Total by Year" for composite performance):
Additional performance details for the composite are available in the prospectus.
Shares of the Balter Discretionary Global Macro Fund are available in institutional (MUTF:BGMIX) and investor (MUTF:BGMVX) classes. The management fee on the fund is 1.70%. Institutional shares have a 1.89% net-expense ratio, inclusive of fee waivers and expense reimbursements, and a $50,000 minimum initial investment. The investor class shares have a 2.19% net-expense ratio and a $5,000 minimum investment, except for shares held in retirement and automatic investment accounts, for which the initial minimum is just $1,000.
For more information, read the fund's prospectus.
Past performance is not indicative of future performance. See the prospectus for disclosures and other information.