Fusion Hedge Overlay Program

The events of 2008 demonstrated the need for the active risk management of fund portfolios in addition to pure asset/fund allocations. The Fusion Hedge Overlay Program provides enhanced risk management to clients without active trading capabilities. The program comes at low marginal cost and offers high liquidity.

Rationale

The program adds a competitive advantage to clients’ portfolios. It is highly responsive to changing market conditions. It allows clients to adjust market exposure without needing to redeem from managers.  This avoids damaging existing relationships. The program also proves effective in cases where the investment is locked or gated.

Prospective Clients

The service benefits clients without existing trading desks and developed trading/settlement infrastructure, for example:

• Funds of Funds and Private Equity Funds
• Insurance Companies and Pension Funds

Advantages

• Outsourcing tactical hedging to a firm with full trading infrastructure while maintaining full control
• Systematic and robust quantitative risk management
• Full transparency with daily positions and P&L report

Additional Services

In addition, clients can benefit from services provided in conjunction with the hedging program:

• Enhanced return on unutilized cash through daily sweeps to Fusion Cash Management Program (LIBOR+Range) 
• Quantitative analysis of the portfolio and optimized hedging strategy

Fusion Hedge Overlay materials