AIP Mutual Funds Hedge Fund Strategies in a Mutual Fund(SM) Passes the $500 Million Mark
July 17 2007 - 11:54AM
PR Newswire (US)
Alpha Hedged Strategies Fund (ALPHX) Ranked #1 out of 23 for Three
Years and #8 out of 49 for One Year, Beta Hedged Strategies Fund
(BETAX) Ranked #2 out of 49 for One Year, in Lipper's Equity Market
Neutral Category (based on total returns) as of 6/30/07. WHITE
PLAINS, N.Y., July 17 /PRNewswire/ -- AIP Mutual Funds, who's
flagship Alpha Hedged Strategies Fund (Ticker: ALPHX) was launched
in September 2002, recently passed the $500 Million mark in net
assets. The Fund, managed by AIP Alternative Investment Partners,
LLC (AIP), has been a top performer in Lipper's Equity Market
Neutral Funds category. The Alpha Hedged Strategies Fund has
outperformed its category average with 9.54% and 9.36% total 1-year
and 3-year annualized returns; the category averages were 5.24% and
4.01%, respectively, as surveyed by Lipper Analytical Services,
Inc.*, as of 6/30/07. Standardized Performance as of 6/30/07 (%)
Since Incep. 1Yr 3 Yr* 9/23/02* ALPHX 9.54 9.36 7.73 Lipper EMN
Category 5.24 4.01 N/A Lipper Ranking 8/49 1/23 N/A Total Annual
Fund Operating Expenses 6.05% Net Fund Operating Expenses 3.99%**
Since Incep. 1Yr 3 Yr* 4/28/06* BETAX 14.63 N/A 6.11 Lipper EMN
Category 5.24 4.01 N/A Lipper Ranking 2/49 N/A N/A Total Annual
Fund Operating Expenses 6.70% Net Fund Operating Expenses 3.99%**
Performance data quoted represents past performance; past
performance does not guarantee future results. The investment
return and principal value of an investment will fluctuate so that
an investor's shares, when redeemed, may be worth more or less than
their original cost. Current performance of the Fund may be lower
or higher than the performance quoted. Most recent month-end
performance is available by calling 1-877-LOW-BETA. *Average
Annualized Return ** Excluding dividends on short positions and
interest on borrowing. The Alpha Hedged Strategies Fund has been a
pioneer in the open-end multi- strategy hedged mutual fund arena,
in providing broad access to specialized hedge fund managers.
Representing the next generation of products for hedged portfolio
investing, the Fund is designed to minimize equity market exposure
and volatility by employing a variety of absolute return oriented
hedged strategies. The Alpha Hedged Strategies Fund currently
manages $491 MM and has received a 4-star Overall Morningstar
Rating TM among 57 funds in the Long/Short Category as of 6/30/07
(derived from a weighted average of the Fund's three-year
Morningstar Ratings metrics, which are based on risk- adjusted
return performance)**. "The combination of our 'real deal' hedged
strategies and mutual fund structure has really resonated with
advisors seeking both a conservative portfolio risk profile and
strong risk-adjusted performance. We have avoided the 'hedge fund
replicator' approach that has left many investors feeling short on
returns and long on market correlation. We are pleased to have
passed the 500 million mark," noted Lee Schultheis, Chief
Investment Strategist and Founder of AIP. "We are also getting
increased traction with our newer Beta Hedged Strategies Fund
(BETAX), which is really just a more aggressive mix of our platform
of managers and strategies, for investors seeking higher potential
returns, and need a lesser degree of risk control." "We continue to
attract a broader range of investors, recently including Endowments
and Foundations, Defined Benefit plans and Bank Trust Departments,
as well as our core channel of Financial Advisor intermediaries.
Since we've been competitive with Hedge Fund Research, Inc.'s
(HFRI) Conservative Fund-of- Funds index over the last 4 years, we
are viewed as having 'walked the walk' by the marketplace, and are
not just the latest in the recent wave of new products that claim
to be able to 'mimic' hedge fund performance in some indirect
manner, but where early results are not meeting market
expectations." The Fund has a portfolio that operates much like a
conservative hedge fund-of-funds, and is accessible to all
investors. AIP currently utilizes 20 + hedge fund managers to
manage the individual portfolio strategies within ALPHX. As with a
traditional hedge fund structure, the Fund can sell short (up to
100% of net assets), use leverage (up to 50% of net assets), and
can employ any strategy where the securities involved can be priced
on a daily market value basis. However, because The Alpha Hedged
Strategies Fund is structured as a mutual fund, it also offers
several key features including daily liquidity, no lock-ups, no
accreditation requirement, no performance fees, and 1099-tax
reporting. By controlling custody of assets, valuation, and
leverage on the underlying security pools, as well as having 100%
transparency for all positions and trades, AIP can mitigate a
number of the primary risks that lead to occasional problems with
underlying hedge funds holdings, as can occur with the traditional
private hedge fund-of-funds structure. "Financial intermediaries
want a broad array of quality hedge-fund strategies for their
clients, but they prefer the mutual fund structure and features,
and are not willing to sacrifice the non-correlative, alpha-driven
'behaviors' that have made hedge funds so popular with
sophisticated institutions and high net worth individuals," said
Mr. Schultheis. "That is the market niche that we feel AIP Mutual
Funds has effectively addressed." For more information or to speak
with Lee Schultheis please contact Jennifer Connelly at (973)
625-1130 or . Financial Intermediaries can call 1-866-LOW-BETA or
visit http://www.aipfunds.com/. About AIP Funds ALPHX and BETAX are
open-end mutual funds that invest their portfolios in a manner
similar to a conservative and more aggressive, hedge fund-of-funds,
respectively. The Funds employ a multi-manager approach to a
variety of hedged alternative investment styles, but each with a
liquid portfolio of its own securities, using the limited amounts
of leverage and short-selling allowable in open-end mutual funds.
The Funds provide broad exposure to a variety of active management
hedged strategies including: Distressed Securities & Special
Situations, Long/Short Equity, Long/Short Market-Neutral Equity,
International Long/Short Equity, Global Long/Short Equity,
Specialty Sector Long/Short Equity, Equity Options Overlay, Global
Hedged Income, Merger Arbitrage, Fixed-Income Arbitrage, and
Convertible Bond Arbitrage. The Funds utilize the talents of highly
specialized hedge fund managers as sub-advisors, in executing their
alternative investment strategies. The Funds offer the portfolio
diversification benefits that institutions, pension funds,
endowments & foundations, and high-net worth individuals have
become accustomed to in hedge funds. The Funds combine these
portfolio attributes with the daily pricing, liquidity, and other
shareholder features commonly associated with open-end mutual
funds. As such, the Funds are uniquely positioned to provide their
shareholders with additional portfolio diversification to
complement the traditional asset classes of stocks, bonds and cash.
Funds Disclosure The Funds' investment objectives, risks, charges
and expenses must be considered carefully before investing. The
prospectus contains this and other important information about the
investment company, and it may be obtained by calling
1-877-Low-Beta (569-2382), or visiting http://www.aipfunds.com/.
Read it carefully before investing. About Risk: Certain hedging
techniques and leverage employed in the management of the Funds may
accelerate the velocity of possible losses. Short selling involves
the risk of potentially unlimited increase in the market value of
the security sold short, which could result in potentially
unlimited loss for the Funds. Derivatives involve investment
exposure that may exceed the original cost and a small investment
in derivatives could have a large potential impact on the
performance of the Funds. Options held in the Funds may be illiquid
and the fund manager may have difficulty closing out a position.
The Funds may also invest in: -- smaller capitalized companies --
subject to more abrupt or erratic market movements than larger,
more established companies; -- foreign securities, which involve
currency risk, different accounting standards and are subject to
political instability; -- securities limited to resale to qualified
institutional investors, which can affect their degree of
liquidity; -- shares of other investment companies that invest in
securities and styles similar to the Funds, resulting in a
generally higher investment cost than from investing directly in
the underlying shares of these funds. The Funds intend to utilize
these individual securities and hedging techniques in matched
combinations that are designed to neutralize or offset the
individual risks of employing these techniques separately. Some of
these matched strategies include: merger arbitrage, long/short
equity, convertible bond arbitrage and fixed-income arbitrage.
There is no assurance that these strategies will protect against
losses. The Funds are non-diversified and therefore may invest in
the securities of fewer issuers than diversified funds at any one
time; as a result, the gains and losses of a single security may
have a greater impact on each Fund's share price. Because the Funds
are fund-of-funds, your cost of investing in the Funds will
generally be higher than the cost of investing directly in the
shares of the mutual funds in which it invests. By investing in the
Funds, you will indirectly bear your share of any fees and expenses
charged by the underlying funds, in addition to indirectly bearing
the principal risks of the Funds. Please refer to the prospectus
for more information about the Funds, including risks, fees and
expenses. * Lipper Analytical Services, Inc. is an independent
mutual fund research and rating service. Each Lipper average
represents a universe of funds with similar investment objectives.
Rankings for the periods shown are based on fund total returns with
dividends and distributions reinvested and do not reflect sales
charges. While the Funds are no-load, management fees and other
expenses still apply. ** (C) 2007 Morningstar, Inc. All Rights
Reserved. The information contained herein: (1) is proprietary to
Morningstar; (2) may not be copied or distributed; and (3) is not
warranted to be accurate, complete or timely. Neither Morningstar
nor its content providers are responsible for any damages or losses
arising from any use of this information. Past performance is no
guarantee of future results. For each fund with at least a
three-year history, Morningstar calculates a Morningstar Rating(TM)
metric each month by subtracting the return on a 90-day U.S.
Treasury Bill from the fund's load- adjusted return for the same
period, and then adjusting this excess return for risk. The top 10%
of funds in each category receive 5 stars, the next 22.5% receive 4
stars the next 35% receive 3 stars, the next 22.5% receive 2 stars
and the bottom 10% receive 1 star. The Overall Morningstar
Rating(TM) for a fund is derived from a weighted average of the
performance figures associated with its three-, five-, and ten-year
(if applicable) Morningstar Rating(TM) metrics. The Alpha Hedged
Strategies Fund was rated against the following numbers of U.S.
domiciled Long-Short funds over the following time periods: 57
funds in the last three years. With respect to these Long-Short
funds, Alpha Hedged Strategies Fund received a Morningstar
Rating(TM) of 4-Stars for the three-year period ending 6/30/07.
Morningstar defines Long-Short as: a fund with roughly 20% their
total net assets in short positions. HFRI (Hedge Funds Research,
Inc.) Performance Indices are equally weighted hedge fund
performance indices broken down into 37 different categories by
strategy, such as "equity market neutral" investing and
"conservative or market-neutral fund-of-funds" investing.
Conservative Fund of Funds investing seeks to profit by investing
in various absolute return hedged strategies. Alpha is an
annualized return measure of how much better or worse a fund's
performance is relative to an index of funds in the same category,
after allowing for differences in risk. Quasar Distributors, LLC,
Distributor - 7/07 DATASOURCE: AIP Mutual Funds CONTACT: Jennifer
Connelly of JC Public Relations, +1-973-625-1130, or , for AIP
Mutual Funds Web site: http://www.aipfunds.com/
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