Apollo Capital claims to be Australia’s first crypto hedge fund. They aim to achieve exceptional returns by investing in digital currencies like Bitcoin, Ethereum and Initial Coin Offerings.
The Apollo Capital hedge fund investment strategy is to deliver exceptional returns to crypto investors by focusing on four key areas.
- Actively managing a portfolio of liquid cryptocurrencies
- Investments in Initial Coin Offerings (ICOs)
- Opportunistic cryptocurrency trading based around macroeconomics and event driven trades
- Statistical arbitrage that exists across the diverse and fragmented cryptocurrency market
This cryptocurrency investment strategy chosen by Apollo Capital is a very broad and ambitious approach to portfolio diversification. An event driven and arbitrage based investment strategy requires experience and technical skills with excellent cryptocurrency trading technology.
From a human resource point of view, Apollo Capital has the basis to build an excellent team. Henrik Andersson is the CIO of Apollo Capital, having almost 10 years experience on Wall Street and over 17 years dealing with global financial markets. Apollo Capital also has access to Advisors who have experience with cryptocurrency markets and trading along with a small in-house team of analysts.
The basis of the Apollo Capital fee model is a traditional 2:20 model where there is a 2% per annum management fee and then a 20% performance fee subject to a high watermark. The ability to redeem capital is on a quarterly basis with disincentives by way of redemption fees to encourage investors to leave their funds in the crypto hedge fund for a minimum of 2 years.
Apollo Capital launched in February 2018 with a return for the month of 5.17%. Given the 10% + dip in the crypto market during February this is a reasonable return although if they hadn’t allocated all of their capital prior to the dip then by on the reversal would have provided an excellent opportunity to take advantage of the 20% to 30% bounce.
From an overall perspective, Apollo Capital appear to be one of Australia’s only genuine cryptocurrency hedge funds. They have a strong presence in the media and are notable participants at cryptocurrency industry events across Australia. If they continue achieving 5% + monthly returns throughout 2018 then they will start to gain traction as a serious vehicle to deploy capital across the cryptocurrency asset class.
We’ll be keeping an eye on the performance return of Apollo Capital and particularly how their team grows over 2018 as to whether they could be suitable investment for us to deploy capital across.