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By Paul Barr, Senior Reporter
Friday, May 17, 2002
COLUMBUS, Ohio (HedgeWorld.com)—Prospero Capital Management LLC registered three private hedge funds with the Securities and Exchange Commission.
Prospero will launch a long-only unleveraged fund, a long/short fund and a market neutral fund. The long fund, Antenor Fund LLC, will use a value style approach that lies somewhere in between Graham-Dodd and growth at a reasonable price, said the firm’s 31-year-old president, Benjamin J. Bornstein.
The long/short fund, Beaumont Fund LLC, will combine the same long-strategies from the Antenor Fund with selected short trades. The market neutral fund, Curan Fund LLC, will invest similarly, but will aim to equally balance the long and short portfolios, aiming to be both dollar-neutral and beta neutral, Mr. Bornstein said. He’ll also use index-linked securities on the short side when necessary to keep the portfolio balanced between long and short.
Mr. Bornstein said he established Prospero’s core portfolios for the funds a few years back, and is having the returns audited by the fund auditor Arthur F. Bell & Associates, Baltimore. Prospero currently manages US$9 million in high-net-worth assets. He said that he decided to register the hedge funds in order to allow a bigger chunk of assets to come from pension fund clients. Traditional hedge funds are limited to keeping 25% of their assets in Employee Retirement Income Security Act-regulated assets; otherwise they’ ll be subject to ERISA regulation.
The fund charges 1.5% annually and 20% of net profits with a high-watermark. The investment minimum is US$500,000. Banc of America, Chicago, serves as the fund’s primer broker and Paul, Weiss, Rifkind, Wharton & Garrison, New York, is legal counsel.
Mr. Bornstein said his firm’s name and the fund names are all taken from works of William Shakespeare.
PBarr@HedgeWorld.com