The Blackstone Group L.P. (NYSE:BX), one of the largest investment and advisory firms worldwide, announced that it is opening a mutual fund in an effort to attract individual investors.
According to the investment and advisory firm, its hedge fund solutions business Blackstone Alternative Asset Management (BAAM) will manage and operate the mutual fund, which will focus on alternative investments.
Blackstone emphasized on BAAM's AUM
The Blackstone Group L.P. (NYSE:BX) emphasized that BAAM has approximately $49 million assets under management and it’s the world’s largest discretionary allocator to hedge funds. The mutual fund is designed to provide custom solutions for strategic investors. The firm aims to take advantage of its long-term relationships with some of the leading hedge fund managers within the industry.
The mutual fund will be called the Blackstone Alternative Muti-Manager Fund. It is a registered open-end mutual fund and its ticker symbol is BXXMX.
The Blackstone Group L.P. (NYSE:BX) explained that the investment objective of the mutual fund is to look for capital appreciation by allocating assets among different investment sub-advisers with experience in managing alternative investment strategies. The company also plans to manage a portion of the mutual fund’s assets directly or to invest in unaffiliated hedge funds.
In a statement, J. Tomilson Hill, vice chairman of The Blackstone Group L.P. (NYSE:BX) and CEO of BAAM, said, “We achieved our status as a premier hedge fund solutions provider by preserving capital in the midst of volatile markets and by developing innovative solutions to meet our investors’ needs. We are delighted to enter this market and to offer a daily liquid product that provides portfolio diversification through alternative strategies that are designed to be uncorrelated with those of traditional asset classes.”
Stephen Sullens, senior managing director and head of portfolio management for BAAM explained that the firm implemented its portfolio construction process by leveraging its extensive experience in developing custom solutions for sophisticated investors. He said, “Investors in this product will benefit from the full breadth of Blackstone’s manager due diligence and screening procedures, top down asset allocation views and ongoing portfolio management capabilities.”
Based on a regulatory filing with the Securities and Exchange Commission (SEC), the Blackstone Alternative Muti-Manager Fund will charge an annual fee of 3.25 percent fee on assets including a 1.95 percent management fee.
Some of the sub-advisors of Blackstone Alternative Muti-Manager Fund that will receive allocations include Two Sigma Advisers, LLC, Cerberus Sub-Advisory I, LLC, Credit Suisse Hedging-Griffo ServiVos Internacionais S.A., HealthCor Management, L.P. and Caspian Capital LP, and Boussard and Gavaudan Asset Management, LP among others.