Highland Capital Management has strengthened its longstanding commitment to liquid alternative solutions with the launch of Highland Alternative Investors, a new platform that will encompass all of Highland’s existing liquid alternative funds.
“The introduction of this platform will further strengthen our offerings and ability to drive results as well as allow Highland to better offer customized solutions across portfolios to investors,” said Mark Okada, Highland’s co-Founder and CIO, in a March 23 statement.
Highland’s alternative mutual funds include all of the following:
Michael Gregory, Managing Director and Head of Healthcare Credit and Equity, will head up Highland Alternative Investors as its CIO. Mr. Gregory will retain his other roles with Highland, including his duties as lead portfolio manager of the Highland Long/Short Healthcare Fund. That fund has $550 million in assets under management (AUM) and has been the best-performing long-short equity fund two years running under Mr. Gregory’s management.
“We are confident that these organizational enhancements along with Michael Gregory’s oversight will facilitate superior, repeatable performance,” said Highland President and co-founder James Dondero. “Consolidating our liquid alternative strategies within a robust, unified platform allows us to develop products in a timely and thoughtful manner to meet investor needs.”
Last year, the Highland Long/Short Healthcare Fund returned 17.1% compared to a category average of 2.9%; and this year it’s already off to a good start, up 9.9% for the year according to a March 20 article published by InvestmentNews.
Highland isn’t looking to immediately expand its line of liquid alts products, but Mr. Gregory is not ruling it out down the line. “I’ve been the architect of this new platform, and we realized the alternatives space was going to be big, and we wanted to be involved, and we wanted to transfer some of our expertise to the liquid alts side,” he said. “Right now we want to better position our current funds.”
Morningstar alternative strategies analyst Anthony D’Asaro III called the move “internal restructuring,” and said he didn’t think it would have an “immediate impact” on Highland’s fund investors. However, he added, “Liquid alternatives are making up an increasing share of Highland’s assets under management, and this move is a recognition of their importance.” Echoing Mr. Gregory’s predictions for the future, Mr. D’Asaro also said that the new platform “sets the stage” for Highland to launch more liquid alts in the future, and even speculated that Highland’s liquid alts AUM could surpass its traditional business.
For more information, visit highlandfunds.com