The Total Return strategy provides individual investors with a diversified portfolio of high-quality, private investments that are generally not available to individuals. Most individual investors do not have the capital, the connections, or the time to source, diligence, construct and monitor a diversified alternative investment portfolio. SMC enhances an investor’s access to this portfolio of high-quality investments by offering co-investment opportunities. This allows investors the opportunity to access additional exposure to deals, themes, or investments the fund is participating in.
Return objectives similar to private equity
The Total Return strategy is designed to capture the private equity return premium with a considerably shorter illiquidity period than is typically required for most private equity investments. We do this via a dynamic allocation focus that is both opportunistic and thematic. We believe most alternative investment strategies are cyclical and over any market cycle there will be times to invest and times to avoid strategies, asset classes, or investments. For investors with little or no exposure to alternatives, an allocation to a fund that dynamically allocates to investments across the alternative investment spectrum can enhance one’s overall portfolio risk adjusted return expectations.
Investor friendly structure
Total Return invests in a mix of public and private investments to ensure committed capital is typically fully invested. SMC investors generally have all their committed and invested capital working for them on day one. Additionally, the strategy provides investors with quarterly liquidity rights and a semi-annual distribution option. This provides investors a few ways to access their capital when they need it. Finally, the strategy has a unique incentive fee structure that ensures an investor has earned an equity like return (7%) before SMC has the right to collect any incentive allocation. We appreciate that investors have choices, and they should only be charged a fee if an adequate return of capital can be achieved.