Jun. 6–Three women who are veterans of the financial services industry announced yesterday the formation of NewMarket Capital Partners L.L.C., an investment company in Philadelphia that will managetwo new hedge funds.

NewMarket is managing the funds for CMS Cos., a Philadelphia investment company that helps entrepreneurs manage their money.

Patricia Young, Diana Wagner and Mindy Posoff are the founders of the new hedge funds. “We think it’s a great time to launch NewMarket Capital Partners because it’s anticipated that over $2 trillion will be invested in hedge funds in the next five to seven years,” said Young, 48, the company’s chief investment officer.

One fund is called CMS Manager Select Funds. A so-called fund of funds, it invests in several hedge funds, and has $170 million in assets under management. The CMS fund is geared toward high-net-worth individuals. Young would not disclose the minimum investment.

NewMarket’s second fund, which will close on June 30, will be called NewMarket Capital Partners Select Fund. It also will be a fund of hedge funds, and it will be aimed at institutional investors. The company would not discuss the size of the fund, but its minimum investment would be $1 million.

Since 1990, the hedge-fund industry has grown more than 600 percent, after adjusting for inflation, from $92 billion in assets to $650 billion, according to Van Hedge Fund Advisors International Inc., a research firm in Nashville.

The research company also said hedge funds had gained an average of 11.2 percent in value annually over the last five years, while stock mutual funds lost 1.2 percent in the same period.

Hedge funds are unregistered pools of private investments in stocks, bonds, and other types of securities.

The original purpose of such a fund was to “hedge” one investment in case another investment declined in value. For instance, a hedge-fund manager might buy shares of ChevronTexaco Corp. and short-sell shares of Exxon Mobil Corp.

Unlike mutual funds, they are not required to disclose their asset allocations, investment strategies or fee structures to regulators. Typically, a hedge-fund manager charges a fee of 1 percent to 2 percent of the fund’s assets, and can keep up to 20 percent of its annual return.

Young was a principal at CMS, where she headed the company’s alternative-investment division. Before that, she was a senior vice president at Alliance Capital Management L.P.

Posoff, 46, is chief operating officer at NewMarket Capital. She previously was a vice president at E-Trade Group Inc., the online trading company, and a director at Credit Suisse First Boston.

Wagner, 47, oversees marketing for NewMarket Capital. She previously held senior jobs in institutional fixed-income sales at Credit Suisse First Boston and Morgan Stanley Dean Witter & Co.

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To see more of The Philadelphia Inquirer, or to subscribe to the newspaper, go to http://www.philly.com

(c) 2003, The Philadelphia Inquirer. Distributed by Knight Ridder/Tribune Business News.

Jun. 6–Three women who are veterans of the financial services industry announced yesterday the formation of NewMarket Capital Partners L.L.C., an investment company in Philadelphia that will managetwo new hedge funds.

NewMarket is managing the funds for CMS Cos., a Philadelphia investment company that helps entrepreneurs manage their money.

Patricia Young, Diana Wagner and Mindy Posoff are the founders of the new hedge funds. “We think it’s a great time to launch NewMarket Capital Partners because it’s anticipated that over $2 trillion will be invested in hedge funds in the next five to seven years,” said Young, 48, the company’s chief investment officer.

One fund is called CMS Manager Select Funds. A so-called fund of funds, it invests in several hedge funds, and has $170 million in assets under management. The CMS fund is geared toward high-net-worth individuals. Young would not disclose the minimum investment.

NewMarket’s second fund, which will close on June 30, will be called NewMarket Capital Partners Select Fund. It also will be a fund of hedge funds, and it will be aimed at institutional investors. The company would not discuss the size of the fund, but its minimum investment would be $1 million.

Since 1990, the hedge-fund industry has grown more than 600 percent, after adjusting for inflation, from $92 billion in assets to $650 billion, according to Van Hedge Fund Advisors International Inc., a research firm in Nashville.

The research company also said hedge funds had gained an average of 11.2 percent in value annually over the last five years, while stock mutual funds lost 1.2 percent in the same period.

Hedge funds are unregistered pools of private investments in stocks, bonds, and other types of securities.

The original purpose of such a fund was to “hedge” one investment in case another investment declined in value. For instance, a hedge-fund manager might buy shares of ChevronTexaco Corp. and short-sell shares of Exxon Mobil Corp.

Unlike mutual funds, they are not required to disclose their asset allocations, investment strategies or fee structures to regulators. Typically, a hedge-fund manager charges a fee of 1 percent to 2 percent of the fund’s assets, and can keep up to 20 percent of its annual return.

Young was a principal at CMS, where she headed the company’s alternative-investment division. Before that, she was a senior vice president at Alliance Capital Management L.P.

Posoff, 46, is chief operating officer at NewMarket Capital. She previously was a vice president at E-Trade Group Inc., the online trading company, and a director at Credit Suisse First Boston.

Wagner, 47, oversees marketing for NewMarket Capital. She previously held senior jobs in institutional fixed-income sales at Credit Suisse First Boston and Morgan Stanley Dean Witter & Co.

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To see more of The Philadelphia Inquirer, or to subscribe to the newspaper, go to http://www.philly.com

(c) 2003, The Philadelphia Inquirer. Distributed by Knight Ridder/Tribune Business News.