Vertex Liquid Alternative Fund Plus
- An Everyday Equity Alternative -
The fundamental investment objective of the Vertex Liquid Alternative Fund Plus is to generate consistent, positive returns, with lower volatility and low correlation to equity markets by providing levered exposure to the Vertex Liquid Alternative Fund ("VLAF").
The Manager intends to invest in units of the VLAF, enter into derivative contracts that are intended to replicate the return of the VLAF (less the implicit funding cost), and/or use the same investment strategies as the VLAF (investing directly in arbitrage situations). As a result of these investment activities, the Manager intends for the VLAFP to gain 200% exposure to the VLAF, net of borrowing and/or dealer costs.
The most common strategy the Manager intends to use in VLAF is merger arbitrage, which involves purchasing the shares of an announced acquisition target company at a discount to the expected merger consideration. When a transaction is announced, the value of the cash and/or securities to be received is typically higher than the market price of the target company. The discount that the target security trades at is called the merger arbitrage “spread.” If the Manager believes that it is probable that the proposed transaction, or a higher value transaction, will be consummated in a time frame that makes the spread an attractive rate of return, VLAFP may purchase shares of the target company.
The Manager intends to use investment strategies designed to minimize market exposure which are permitted within an alternative mutual fund but may be limited or prohibited within other types of mutual funds.
Craig Chilton and Tom Savage are the portfolio managers of the Vertex Liquid Alternative Fund. Both joined Vertex One in January 2010 from CIBC’s highly successful, proprietary trading group.
Craig Chilton, CFA - Mr. Chilton has an extensive background in event-driven arbitrage strategies. Prior to joining Vertex One, he was a Managing Director with CIBC World Markets, where he spent 15 years as a proprietary trader in Toronto, New York and Vancouver. Craig began his finance career in investment banking with Lancaster Financial, and subsequently, Richardson Greenshields. Craig has over 20 years of experience in the investment industry; he is a CFA charterholder and a member of the Vancouver Society of Financial Analysts. He received a Bachelor of Applied Science (Electrical Engineering) from the University of Toronto.
Tom Savage, CFA, MBA - Mr. Savage has an extensive background in alternative strategies and is part of the Vertex One team specializing in merger arbitrage, event-driven arbitrage, and special situations. Prior to joining Vertex One, Tom was a proprietary trader with CIBC World Markets where he was responsible for equity and derivatives arbitrage and special situations strategies. Formerly, he worked in private equity at Birch Hill Equity Partners and began his career as an equity analyst at KBSH Capital Management. Tom is a CFA charterholder and a member of the Vancouver Society of Financial Analysts. He received a Bachelor of Commerce degree from Queen’s University and an MBA from Harvard Business School.
- Class B (FEL) : VRT 2000
- Class F (NL) : VRT 2001
- Minimum Investment :
- $500 (initial)
- $50 (subsequent)
Second Quarter Report, 2019: Merger arbitrage performance was relatively subdued for the second quarter of 2019, primarily due to the continuation of several of the key macroeconomic themes that we saw emerge early in the year. These themes – US/China trade disputes, an unpredictable Trump administration, and Q4 2018 market volatility – also contributed to a quiet start to the year for deal activity overall. While the markets have strongly...
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