Red Star Capital Management LLC is launching its first hedge fund, Red Star Fund LP. The new fund will begin trading October 1st and is domiciled in Delaware. The Red Star Fund LP, in conjunction with its subsidiary Red Star Capital Management LLC, will act in the capacity of assisting clients with their alternative investment strategies. This includes the development of portfolios through the implementation of various derivative arbitrage strategies, with the primary consideration being conservation of capital.
Red Star’s manager, Chris Kanaly, RIA, stated “The strategy includes particular attention to risk management through sector diversification and selective hedging via equity derivatives, index options and short selling where appropriate. Fund performance will be benchmarked to the S & P 500 Index to allow the partners to gauge their capital’s performance had they maintained a long only strategy. In order to execute these strategies, the General Partner seeks out opportunities, which, it believes, offers favorable upside potential while simultaneously entailing less risk than other investment situations.†Red Star LP will also employ a time tested trading approach which will seek small, short term gains in trading various Index ETF’s and their corresponding derivatives, using defined entry and exit points.
Mr. Kanaly has been successfully managing money for years, starting at Commerce Bank’s Capital Markets Division, where he was the director of equity. In 2002 he left Commerce Bank’s Capital Markets Division, to start Kanaly Enterprises LLC, where he directed in excess of $50 million U.S. through the use of multiple global macro strategies and various options hedging policies.
The fund will begin trading with approximately $5 million in capital according to Mr. Kanaly. Total firm assets are about $9 million. The minimum investment in the fund is $1 million, and the fund carries a management fee of 2 percent and an incentive fee of 20 percent, with a high watermark provision.
The new fund allows for quarterly additions and redemptions, with a one year lockup. Goldman Sachs will provide prime brokerage services while Spicer Jeffries and CCS Financial will conduct the auditing and administration services respectively. The new fund has also procured the services of Michael C. Scher, Esq. as legal counsel. Red Star is also listed on hedge fund database, HedgeCo.Net.
Mike Mitchell
Contributing Editor
HedgeCo.Net
mike@hedgeco.net
