Under the management of Allegiant’s Structured Equity Team, portfolio managers Hitesh Patel and Julie Liu invest up to 130% of the portfolio’s value in the most attractively-ranked securities while shorting up to 30% of the portfolio’s value in stocks ranking least attractive based on Allegiant’s proprietary quantitative models, according to a news release from the Cleveland, Ohio-based firm.
The strategy incorporates a number of advanced risk management techniques to control both absolute and relative risk while ensuring trading liquidity, the company said. The Russell 2000 Index will serve as the benchmark for the investment style, which will be capped at $750 million in assets.
“Unlike most 130/30 investment strategies that focus on the large capitalization universe, Allegiant will focus initially on the opportunities in the small capitalization universe,” said John Abunassar, president and CEO of Allegiant Asset Management, in the news release. ” Relaxing the long-only constraint in a less efficient asset class like small cap stocks affords opportunities for increased levels of alpha. “
The 130/30 small cap strategy was initially seeded on December 28, 2006 while Thursday represented the offering’s formal launch, according to the announcement.
Allegiant Asset Management Group is a registered investment adviser and a subsidiary of National City Corporation (NCC). More information is at http://www.allegiantassetmanagement.com/ .