Intended to diversify holdings for taxable investors with illiquid holdings. Commodity-trading advisory Trowbridge Management has created new managed-futures fund for high-net-worth investors with substantial illiquid assets using Welton Investment Corporation's Global Directional Portfolio (GDP).

Trowbridge president Stan Dickson says the new Trowbridge Global Fund had to meet two criteria. "First, [its] returns needed to be diversified from equities, private equity and real estate" because many "high-net-worth investors already have significant exposures in these areas," he says. Second, it had to include features specifically geared to taxable private investors.

Both requirements

Welton's GDP program meets both requirements, according to Dickson. "It is rigorously managed to have a low correlation to equities and equity-based hedge funds, and has the stability of a multi-manager pool" and it has "a tax-efficient funding structure well suited to high-net-worth investors with illiquid assets or other assets that carry burdensome tax consequences if divested," he says.

"This is a powerful concept, and investors and wealth managers I've spoken with readily appreciate this funding structure," says Dickson. "Illiquid investors want to increase the rate of return on their asset base, and this method is low cost, easy, and could yield significant returns."

Trowbridge also offers referrals to banks for investors to obtain letters of credit against real estate, portfolios, or company balance sheets.

Founded last year, Grosse Pointe Park, Mich.-based Trowbridge is managing member and commodity-pool operator of Trowbridge Global Fund .

Carmel, Calif.-based Welton is a hedge-fund manager that specializes in managed futures. It has been working with banks, funds of funds, family offices and institutional investors for about 18 years. -FWR

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