Central Park Group's approach to fund selection starts with the identification of investment themes, asset classes, sectors and strategies.
The Firm attempts to select, what it believes to be, the best suited firm to execute the strategy and investment theme. Managers selected typically have long-term distinguished records and broad global resources. Candidates are initially identified through strategic partners, long-standing relationships and referrals from the Firm's network of managers, service providers, distribution partners and other sources.
Hedge Funds & Funds-of-Funds
Central Park Group attempts to identify hedge fund managers who have a demonstrated "investment edge." A manager's competitive advantage is typically driven by fundamental proprietary research, qualitative and quantitative analysis of companies, relentless focus and hard work. The Firm seeks to avoid managers who depend exclusively on external research or those who employ "black box" strategies, momentum investing, or who rely on excessive leverage or complex derivatives.
Private Equity & Real Estate
Central Park Group seeks firms with proprietary deal flow, creative financial structuring, operational know-how, global presence and a network of senior operating professionals. The Firm has invested with several of the largest private equity and real estate managers. Many of these managers have unparalleled global resources, access to capital, banking relationships, and extensive networks which they believe may provide a distinct competitive edge.
The Firm's due diligence process is rigorous and systematic. Due diligence is viewed as a mosaic where qualitative and quantitative information is assembled and analyzed. Issues such as manager reputation, integrity, personal commitment and potential conflicts of interest are assessed. How a manager's firm is organized, staffed and compensated are critically important factors in the assessment as are the manager's investment and organizational skills.
Central Park Group due diligence may include:
Direct
Research
• Offering materials
• Financial statements
• Tax filings
• Client correspondence
• Performance attribution
• Portfolio holdings
• Investment team
• Operational capabilities
• On-site diligence
Indirect
Research
• Background checks
• Reference checks
• Regulatory history
• Public filings
• Current/past investors
• Asset confirmation
• Industry contacts
Ongoing Due Diligence
and Monitoring
• Performance verification
• Conference calls
• Written updates
• Manager meetings
Not all factors considered with respect to each fund or manager. Other factors may be considered.
Image: The Arcade - Central Park