Compendium of 2019 Research Notes

As 2019 draws to a close ActiveAllocator concludes its research agenda for the year by providing you a compendium of our recent reports. These are loosely structured around the active asset allocation and management theme with a focus on hedge funds and private equity transactions. We also have a section on the role of investments in climate change – a topic we foresee garner increased attention in 2020. This compendium is attached here in PDF. See you next year!

Compendium Deck

Management Compensation, Retention, Severance in Private Equity Leveraged BuyOut

ActiveAllocator is pleased to share with you our research piece on “Management Compensation, Retention, Severance in Private Equity Leveraged BuyOut “.  Gleaned from our own experience across over $40 billion in M&A, poring over scores of SEC filings, and our private investment diligence credentials we bring visibility to a topic long shrouded in secrecy. Our deck sheds light on why the average CEO pay is 271 times the nearly annual average pay of the typical American worker, why select normal senior executives become extra ordinarily wealthy during certain corporate events, and other subjects of conversation. We describe the main components of compensation, the general features of equity retention and severance arrangements and employment contracts, and conclude with a few case studies to illustrate calculations.

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Management Compensation, Retention, Severance in Buyouts

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How to Buy Companies and Assets

Institutional investors running deep pools of capital moving to in-house management, now increasingly do club and direct deals outside allocating to traditional private equity fund sponsors. They compete and win and also outperform co-investments. The ones who do, usually have excellent in house talent, access to deals etc. But what exactly is a deal? How do you buy a company? The actual process has long been shrouded in secrecy and practitioner jargon. Having done +$40 billion in M&A, seen and evaluated hundreds of buy offers, having sold portfolios of assets and companies, we bring sunlight to the ‘investment banking’ buy space.

Video here:

Deck here:

The Buying Process

Rise of Protectionism in M&A Deals in USA

We build on our M&A series by drawing attention to changes in US regulatory environment for foreign deals in the Trump presidency. The national security landscape has shifted in recent years, and so has the nature of the investments that pose the greatest potential risk to national security. Recent amendments to the Committee on Foreign Investment in the United States (CFIUS) process now brings significant hurdles to foreign investment in ‘sensitive’ sectors. The Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) was signed into law after receiving broad bipartisan support in Congress and new regulations are expected. We provide historical context, highlight recent evolution and provide color on consummating such transactions.

Download deck here: Rise of Protection in M&A Deals in USA

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Allocating to Activist and M&A Hedge Funds

ActiveAllocator, is pleased to share with you our latest research piece ” M&A and Activist Hedge Funds”. Given our unique vantage point we see trades, that such firms do. These secretive funds have long been subject of folklore . Preserving confidentiality , we introduce here the ‘anatomy’ of how such deals get played out. In future we also hope to show you 30-40 case studies

PDF here: Activist Hedge Funds

Preview here:

Event Driven Hedge Funds – Share Buyback

ActiveAllocator is pleased to share with you our latest research piece ” Event Driven Hedge Funds – Share Buyback”. Event Driven hedge funds exploit pricing inefficiency before, during or after corporate events. Episodes of shares buyback or around dividends announcement are a potential source of alpha. We explain the capital redistribution framework and illustrate the mechanism of a tender offer to provide color.

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Event Driven Hedge Funds-Share Buyback1

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Conceptual Approach to Intra-hedgefund Strategies Allocation

ActiveAllocator is pleased to share with you our latest research piece ” Intra hedge fund asset allocation framework”. We explain how one may intelligently choose from +20 hedge fund sub-strategies, sift jargon, and combine in the right amounts to meet specific asset allocation objectives, through correct portfolio construction

Video preview of deck here

 

Download presentation pdf here :

Intra- Hedge Fund Asset Allocation Framework

M&A Arbitrage – How to Get it Right

ActiveAllocator allocates to major hedge fund strategies and their sub-types including Merger Arbitrage. Given the wide dispersion in returns in M&A funds we believe that hedging the time period deal risk is integral to both profitable trade as well as helpful for diligence. We present the anatomy of the M&A trade by drawing attention to the ‘Collar’ and reconstructing it from first principles.

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M&A Arbitrage – How to Get it Right1

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Climate Change, Policy and Investments

ActiveAllocator is pleased to share with you our latest research piece – Climate Change. In this comprehensive deck we explain our take on: Climate Change and Government, Global Financial Markets Response, Impact of Climate Change on Developing World, Deforestation, Role of Investment and Finance.

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Climate Change, Policy and Investments

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ActiveAllocator “summarizes” the imminent Aramco IPO

 

ActiveAllocator summarizes the imminent Aramco IPO- soon to become the world’s most valuable company. We touch upon the offering, the firm’s vision, status, synergies between its upstream-downstream business, competitive strengths, risks to investing and general prospects.

Listen in here:

https://vimeo.com/374307403

Disclosure: Inputs sourced from internet searches, offering docs, conversations. Shares are not offered in the USA and some other countries. This is not an offer to sell or a solicitation of any offer to sell any securities.

ActiveAllocator Tech Improvement in 2019

ActiveAllocator is a MIT-Harvard-Technion-Yale -UCDavis alum founded WealthTech startup. We analyze and integrate traditional, illiquid and alternative investments to improve complex portfolios: This actual live screen capture here aggregates customers accounts across +15,000 banks, sources capital market inputs from +10 Wall Street firms, simultaneously analyzes +10 million asset allocations deployed across +4 million securities, within +50 granular asset sub-classes, personalizing target portfolio to +100,000 preferences, whilst executing seamlessly across +20 broker dealer systems. All done in under 2 minutes.