FundCreator Endorsements
FundCreator is the most efficient tool to create returns with pre-defined statistical properties
at the end of any given time horizon. Based on the powerful dynamic replication technology developed by
Harry Kat and Helder Palaro, it opens new doors to the passive replication of hedge funds and hedge fund
indices using simpler and more liquid instruments.
Dr. Francois-Serge Lhabitant
Chief Investment Officer Kedge Capital and Professor of Finance HEC Lausanne and Edhec Business School
FundCreator is a very impressive piece of work, with an intuitive and easy to use website. The model is
based on a completely novel approach for addressing the subject of generating low-cost investment returns,
which may prove to be revolutionary in the future.
Pete Eggleston
Head of Quantitative Solutions, Royal Bank of Scotland.
Modern investment practitioners should be aware of the empirical fact that there is hardly any such thing
as “pure alpha“ that is generated by the wide universe of hedge funds that are available to investors.
Despite all dedication and skill that is applied to deliver superior and stable returns, many hedge funds
appear exposed to systematic risk drivers. Sensible investors are no longer willing to pay 2/20 for
returns that can be captured directly or synthetically at reasonable cost. FundCreator is one of these
enlightening innovations in Finance that enable investors to improve the efficiency of their portfolio
structuring process. It offers a gateway to capturing very specific and mostly alternative risk premia
at very competitive cost levels. It can serve to build portfolios within a core-satellite framework, where it can supply sources for the satellite segments. And it can be used in tactical asset allocation frameworks, to capture excess returns that show cyclical behavior. Indeed a great enhancement to the investor’s toolkit.
Fons Lute
Chief Investment Officer, Blue Sky Group, The Netherlands.
Tired of paying high hedge fund fees for beta dressed up as alpha? Then try the FundCreator to create your
desired return distribution. Intuitively it makes a lot of sense and it is very easy to use.
Dr. Leif Hasager
Executive Vice President, Bankpension Copenhagen.
Attracted by the favourable risk-return characteristics of Alternative Investments like hedge funds and
commodities, a growing number of institutional investors have increased their allocation to these
strategies over the past 5-10 years. What is generally overlooked is that these allocations are accompanied
by significantly higher costs (fees, trading costs) than what is generally found with traditional
investments. The FundCreator developed by Harry Kat and Helder Palaro offers the possibility to investors
to replicate the desired return distribution without foregoing the high costs normally found with
Alternative Investments, leading to a better risk-return trade-off. The FundCreator is a significant
contribution to a more efficient implementation of investment strategies.
Hans de Ruiter
Senior Portfolio Manager, Hoogovens Pension Fund, The Netherlands.
FundCreator reflects Harry Kat’s original and often thought provoking views on investing. It bypasses
the daily-adjusted expert views on what to buy and what to sell, and goes directly for the end-result: the
risk-return distribution, including its correlation to other asset returns, that is produced by the investment
process. In the end the message is clear: why pay 2 plus 20 to invest in a hedge fund, if you can get the
same characteristics in a cost efficient way through a dynamic trading strategy involving futures?!
Dr. Bas Peeters
Head of Structured Products, ING Investment Management, The Netherlands.
FundCreator offers institutional investors what they wish for at a fraction of the fee that the hedge fund
community charges. It is transparent, easy to understand, easy to use, and gives a return distribution of
your choice. What more can you wish for?
Dr. Jan Bo Jakobsen
CEO, Invensure, Copenhagen, Denmark.
The concept of FundCreator is extremely appealing. Without claiming any overly optimistic sources of alpha,
FundCreator generates risk-return profiles similar to hedge funds, but at much lower costs. FundCreator and
the research behind it are a significant step forwards in demystifying hedge fund performance and an
important move towards more cost-efficient investments in alternatives.
Dr. Theo Kocken
CEO, Cardano Risk Management, Rotterdam, The Netherlands.
Harry Kat’s numerous studies of hedge fund returns and their diversification properties, as well as his
critiques of hedge fund investing and their associated cost structures, are well known to most people
engaged in high-end analysis of fund performance. His recent work with Helder Palaro on the replication
of the statistical properties associated with fund performance via futures trading is path breaking. The
key product of that work, FundCreator, offers investors an opportunity to synthetically replicate the
statistical parameters that describe a tailor-made hedge fund (e.g., correlation, volatility, etc.)
without the onerous cost. The investor has the task of trading futures as prescribed by the strategy.
But, because performance is achieved through futures trading, where markets are liquid, costs are low,
and valuation is transparent, the investor is not burdened with the overhead that characterizes most hedge
fund investing. In sum, FundCreator is an exceptional and innovative tool for overall portfolio diversification.
Dr. John F. Marshall
Senior principal Marshall, Tucker & Associates and founding member International Association of Financial Engineers (IAFE).
FundCreator is a revolutionary tool for portfolio diversification. Harry Kat’s numerous studies of hedge
funds provide a strong foundation for the work culminating in this remarkable innovation. FundCreator offers
an efficient, low-cost means to create a tailor-made hedge fund that duplicates a desired statistical profile.
Fund performance is achieved using highly liquid futures contracts in efficient markets, where execution
costs are minimal. Reducing costs is fully equivalent to earning higher returns, and in this case less
risky as well.
Dr. Anthony F. Herbst
Partner New Market Solutions LLC and founding editor of The Journal of Financial Engineering.
FundCreator brings the "hedge" back into hedge funds. By replicating the distributional properties of hedge
funds with actively traded derivative products, investors can not only better understand the characteristics
of these funds but can also create customised investments without concerns regarding transparency or liquidity.
All this can be done without paying the exorbitant fees often associated with hedge funds, which will assure
investors a higher return for the same risk profile. As an active investor of my own funds, my only question
is how can I sign up?
Dr. Robert Tompkins
Professor of Finance Hochschule für Bankwirtschaft, Frankfurt and Honorary Professor Warwick Business School.
More to Come.
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