Abria Alternative Investments has created a new fund designed to maximize risk-adjusted investment returns from exposure to global energy markets. The Abria Energy Trust is a diversified fund of energy hedge funds.
Abria says that, to date, most investors have only been exposed to the energy sector through traditional long-only investments.
However, in a market that exhibits extreme volatility, a “buy & hold” strategy is much less desirable than a diversified fund of energy hedge funds designed to maximize returns while mitigating risk, according to Henry Kneis, Abria’s CEO and CIO.
The persistent volatility of energy markets results in price inefficiencies that can be best exploited by skilled hedge fund managers, who can trade both long and short as well as profit from the changing price relationships between related securities or commodities.
“Energy investing should not be primarily a bet on whether the price of oil goes to $105 or back to $40,” explains Kneis. “Our approach is to capitalize on the opportunities that price fluctuations present, as well as the vast opportunities that lie outside the exploration and development area of the energy value chain.”
Kneis, whose alternative investing track record dates to 1987, has had positive returns for the low volatility portfolios he has traded or managed in every year of their existence.