With a focus on bringing diversification, transparency, and liquidity to alternative investments, the Brinker Capital Crystal Strategy is a proprietary product designed to help institutional investors preserve their capital in down markets, while capturing appreciation in up markets, according to a news release.
Brinker Capital is eyeing smaller foundations, endowments, and pension plans in the $10 million-$100 million asset range looking to increase their global macro allocations in a format that doesn’t have traditional hedge fund constraints, the company said.
Crystal Strategy has been available to financial advisers since September 2010. Brinker Capital, however, has been running the portfolio for the past two years to test its performance under a variety of market conditions.
According to the news release, using tactical and strategic processes, Brinker Capital broadly allocates the Brinker Capital Crystal Strategy to invest across six major asset classes, including domestic and foreign equity, fixed income, absolute return, real assets, private equity, and cash. Within these asset classes, Brinker Capital employs an array of investment vehicles, including individual stocks, exchange-traded funds, closed-end funds, open-end funds, and Master Limited Partnerships, among others.
The company said the Brinker Capital Crystal Strategy performs much like other absolute return strategies, but has lower fees compared to many vehicles, and daily liquidity. Furthermore, institutional investors will have daily transparency into their account holdings. The strategy is constructed by merging top-down macroeconomic trends with a bottom-up strategy and stock selection. The target minimum is $1 million.
The news release said in determining the portfolio’s major asset allocation, Brinker Capital starts with a “null hypothesis,” meaning that no individual major asset class deserves a higher weight than any other. From there, based on factors such as valuation, technical trends, sentiment and risks, Brinker Capital strategically overweights the areas they believe will generate the best risk-adjusted return.