Welcome to HIT Capital’s 2015 midyear update.
The Fund continued its trend of outstanding performance by returning 5.47% in the first half of 2015; this puts the Fund up 71.77% since inception. So far in 2015, the Fund has outperformed the S&P 500 by 5.02% (S&P return 0.45%) and the Hedge Fund Index by 2.02% (HFI return 3.45%).
Now that the overall market performance has settled down as compared to the above average returns experienced in 2013 and 2014, the Fund’s beta slippage and contango strategies are more easily recognized. When the market makes large upward (or downward) moves, the inefficiencies captured through beta slippage and contango, as a percentage, are overshadowed by the Fund’s long bias. The long bias causes the fund to move with the overall market while the Fund slowly but consistently captures the aforementioned inefficiencies, beta slippage and contango. So with the comparably flat market we have experienced the past 6 months take a moment to recognize the advantages the Fund is capturing; the green arrows on the performance chart below are meant to illustrate this very point.
As we mentioned in our 2014 update, the Fund has now started to add value investments to its portfolio. We believe value investing is a proven strategy that aligns with our long term investment philosophy, adds alpha (market outperformance), and adds stability to our inherently volatile beta slippage and contango strategies.
You can find specifics regarding the Fund at our recently updated website. When visiting, you will need to enter the password “hitcapital” when prompted. The prior requirement for individual logins has been removed.
Until next time, this is Stephen Read thanking you for your trust and wishing you a safe, content, and prosperous investment future.
Performance -June 30, 2015
Allocations – June 30, 2015
This report is intended to assist limited partners in understanding how HIT Capital LLLP (Fund) performed during the period ended June 30, 2014 and reflects the views of the general partner at the time of this writing. These views may change and do not guarantee the future performance of the Fund or the markets. Portfolio composition is subject to change. The current and future holdings of the Fund are subject to investment risk.
Hedge fund investing involves risks, including possible loss of principal. An investor should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. The Offering Documents contain this and are available by contacting Stephen Read @ 309.253.7887 or Stephen.Read@HITInvestmentsLLC.com. The Offering Documents should be read and understood before investing.
The comparison of the Partnership’s performance to a single market index is imperfect because the Partnership’s portfolio may contain options and other derivative securities, may include margin trading and other leverage and is not as diversified as the Standard and Poor’s 500 Index or other indices. Due to the differences between the Partnership’s investment strategy and the methodology used to compute most indices, HIT Investments cautions potential investors that no indices are directly comparable to the results of the Partnership.
S&P 500 data provided by Yahoo Finance
Hedge Fund Index data provided by BarclayHedge