Miguel Fidalgo’s Triarii capital, produced a return of 7.04% for investors last year taking returns since inception to 7.04% net. The fund began its life in May of last year and has so far produced a steady return for its investors. 2017 has got off to a steady start with returns of 0.32% in January.
By the end of January, the hedhe fund had a gross exposure of 159%, a net exposure of 41% and a total of 42 positions. 33% (gross) of the portfolio is devoted to deep value equities with a further 48% devoted to arbitrage and liquidation situations.
Miguel Fidalgo learned his trade under one of the world most regarded value investors, Seth Klarman. After leaving Klarman’s Baupost Group at the beginning of 2015, Fidaglo declared his intentions to set up his own value fund a few months after.
Triarii capital up 7% In First Eight Months
With an initial $300 million in assets, Triarii has got off to a relatively good start. According to the fund’s fourth-quarter and full-year list to investors, a copy of which has been reviewed by ValueWalk during its maiden year Triarii returned 10.96% net of fees on an annualized basis with a standard deviation of net returns of 5.57% and a Sharpe ratio 1.91. Beta of daily returns to the S&P 500 was 0.28, which equates to 633 bps of annualized alpha, net of fees.
The vast majority of Triarii's returns for last year came from deep value equities, which contributed 4.03% to portfolio level gross returns. Arbitrage and liquidation situations returned 3.81% and distressed and stressed credit returned 2.82%.
The firm had a profitable merger arb/special sits bets but the biggest note is the PIK play the hedge fund sees as a heads I win, tails I win sort of investment.
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