The $45 billion University of Texas Investment Management Company (UTIMCO) has filled the newly created position to manage its stable value hedge fund portfolio.
Anthony K. Caruso joins the endowment as a director. The title was devised as part of president, CEO, and CIO Britt Harris’ 2018 restructuring plans. These involve UTIMCO splitting its $10 billion hedge fund portfolio in two. The new stable value and directional sections are intended to provide for better diversification. It is not known if the directional hedge funds have a head.
The two hedge fund divisions are safeguards against different economic conditions, according to materials from the Texas management company’s May 18 board meeting. The $2.4 billion stable value portfolio reacts to negative GDP surprises, poor earnings, bizarre valuations, and very low inflation rates. Directional hedge funds ($7.7 billion) move with positive GDP, unimpressive inflation surprises, positive earnings, reasonable valuations, and political stability.
Caruso and will manage the stable value hedge fund portfolio while the directional hedge fund portfolio will continue to be managed by Courtney Powers. Both will report to Ryan Ruebsahm, the managing director of hedge funds.
The operation has returned an annual 5.1% over the past decade.
Prior to the Texas job, Caruso was the managing director of non-directional strategies at Mesirow Financial, a hedge fund of funds. He started his career as a trader at Bridgewater Associates and Marquette Partners. Mesirow was acquired by Lighthouse Investment Partners earlier this year.