Our Investment Management Approach
Our hedge fund investment management relies on a process of fundamental research to deploy discretionary themes using exchange-cleared futures and options in the wholesale electricity, natural gas, emissions, and related markets to produce uncorrelated alpha.
Contact usOur Investment Philosophy
The dynamic nature of power and energy markets can provide opportunities to capture alpha through directional, relative value, and volatility term structures. As a nimble group of seasoned hedge fund investment managers, the objective of the firm is to generate superior returns that are uncorrelated to traditional and alternative asset classes.
Managing Risk While Embracing Volatility
Power is unique among commodities in that it cannot be meaningfully stored, and the physical nature of power dispatch requires that supply must equal demand in real time. The result is inherent volatility, and our strategy requires respectful comfort with this characteristic.
A portfolio consisting of diversifying ideas across uncoupled regionalized markets overlaid with a policy requiring drawdown-based reductions in risk capital is designed to opportunistically capture the upside and limit the downside volatilities. Risk management is the backbone to our track record of more than a decade.
Exhaustive Market Research for Insightful Conclusions
The e360 Power research process is a constantly spinning flywheel. Fundamental research is where it all begins. It consists of a formal process around where we poke and pry data to develop and validate ideas.
The constant re-evaluation and stress testing of the assumptions that underpin ideas is present throughout both the research and investment process. The thematic ideas that ultimately go into the portfolio are generated from studying fundamental data through a series of third-party subscriptions, data processing and internal proprietary modeling.
Navigating the Energy Transition through Power, NG, & Emissions Markets
The future is electrifying. We are plugging in more devices than ever, and connectivity is increasingly becoming the fabric of daily life. As we embark on the Energy Transition, we are rapidly changing the way we consume and produce electricity.
EVs, smart devices, cloud computing, and crypto mining are finding more mainstream popularity. These forms of productivity have meaningful implications in shaping electricity demand. The supply of electricity is also shifting to sources with cleaner inputs. As coal plants are retiring at a swift pace, renewables such as wind and solar farms are being called to action to provide replacement power. Differing dispatch characteristics and no clear alignment between older generating facilities going offline and new ones coming online is producing volatility across US power markets. The experience our portfolio managers bring to these markets is unparalleled.
We Use Risk-Wise Investment Strategies
We believe every qualified portfolio should have a flavor of what our strategy can provide. As hedge managers to alternative investments, we understand risk appetites will vary across the investor spectrum.
Our Flagship strategy carries a higher degree of volatility, and an according performance target range. It’s an efficient program to provide exposure to the Energy Transition.
Participate in the Opportunities
Our portfolio managers bring together their best and brightest ideas in a single book. The Flagship Fund provide access to qualified US and Offshore investors that satisfy a wide range of risk appetites.
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Our Investment & Trading Process
The strategy has a discretionary fundamental approach to trading Power, Natural Gas, Emissions, and related products in the form of futures and options with directional, relative value, and volatility expressions. The power focus is specific to North America, while inputs into wholesale electricity price formation, such as natural gas and emissions, is global in nature. At any given time, we have several themes in our portfolio with holding periods that average six months but at times extend even longer. Technical factors, including flow, marketing activity and hedging programs, are always considered as part of the timing and sizing of these ideas, however themes remain always fundamental in nature.
01
Research
The thematic ideas that ultimately go into the portfolio are generated from studying fundamental data through a series of third-party subscriptions, data processing and internal proprietary modelling. We typically start with the analysis of the fuel markets with a strong emphasis in NG.
02
Sizing & Timing
Risk implications at trade and portfolio levels are at the center of the sizing of any trade ideas. With Open Interest, VAR and ETL limitations in mind, we look to understand what size position determines the level of risk from both perspectives. Entry and exit points rely on technical and flow analysis.
03
Execution
Full connectivity with external redundancy allows us to access the exchanges that we trade. A series of products that we trade can only be found at select voice brokerage houses. Relationships with brokers, that in some cases date back 20 years, are instrumental in our ability to find best prices and execute efficiently.
04
Monitoring & Adjusting
Constant re-evaluation of ideas challenges our positions. Even if things progress as expected, we ask ourselves: what can go wrong? Are there reasons to change our view? Do the targets need to be rethought? Is the trade even better than we first imagined? Managing gamma plays a big role here as well.
05
Exiting
When initial exit targets, contract settlement, liquidations roll-off, or option expiration are met, our trading themes complete their cycle. These cycles tend to be rather seasonal. Trades that do not work are expected to be exited before then.
Our Results
Qualified investors can find our performance at one of many hedge fund and alternative investment databases.
Who Invests with e360 Power
We believe every portfolio should be diversified. Our Flagship product allow investors to find the right fit to match a wide array of requirements and preferences.
Institutional
Investors
There is power in numbers. As institutions serve the needs of a large client base, there are hidden exposures to the energy transition that can be difficult to granularize. The investment team at e360 Power can help institutions navigate through unchartered territory as the world redefines its energy needs.
Family
Offices
Cutting edge portfolio construction consists of sourcing ideas that don’t follow the pack mentality. Family offices often excel at optimizing the path less traveled, and there are limited managers offering access to our niche electricity markets.
Fund of
Funds
By providing expertise and active management, Funds of Funds serve as a necessary bridge for investors with the desire, but not the infrastructure, to gain exposure across hedge funds and alternative investments into a single product.
Personal
Wealth
Whether through advisories or self directed, having increased involvement in your personal investment goals can take many forms. Qualified Eligible Participants have the quill of hedge fund alternative investments at their disposal to utilize the uncorrelated returns of e360 Power.
Connect with Us to Learn More
We are passionate about what we do and the markets we trade. The opportunity to have a conversation is just the first step in our journey to explore e360 Power’s unique corner of the hedge fund alternative investment universe.