Crawford Capital Partners, LP is a long/short fund that invests primarily in public equities, options, and equity-linked securities. It is an eclectic portfolio emphasizing out-of-favor, underfollowed and undiscovered securities with a focus on owner-operated companies. The fund employs a multi-style approach blending value, growth, income and special situations. Idea-generation comes 80% from bottoms-up securities analysis and 20% from quantitative and macro insights. The Fund's goals - and track record - are balanced between capital appreciation and capital preservation.
Each investment in the Fund requires a substantial "margin of safety," and the portfolio is actively monitored across a variety of dimensions: position/sector limits, liquidity, unintended correlations, factor concentrations, short borrow costs/recall risk, etc. Hedging is accomplished primarily through single-name put options where there is a negative fundamental thesis; there is little to no use of ETFs. Turnover is driven purely by opportunity; it has been as low as 25% and has high as 200% annually but is typically around 100%. Net exposures range from 20% to 80% net long, depending on market conditions. Leverage is employed rarely/sparingly; gross exposure is limited to 1.75x (LMV+SMV)/NAV.
Primary investment objectives: 1) compound capital at 10% + the 10-year Treasury yield over any 5-year rolling period, 2) protect capital from sudden/severe loss, 3) outperform our hedge-fund peers over a full market cycle, 4) deliver lower volatility than the general equity market. Tax-minimization is an important secondary objective. Crawford Capital Partners, LP employs a hurdle rate -- the 10-Year Treasury Yield -- and offers an incentive-rate reduction for each additional year of lock-up up to 5 years.
Prior to founding the firm in 2009, the members of the General Partner served as securities analysts and managed multi-billion absolute and relative return portfolios for large asset management companies including Wellington Management, Putnam, Fidelity and Stark Investments. All team members invest in the fund alongside the LPs.