DNCF OVERVIEW & DESCRIPTION
We seek to fulfill investors’ goals by producing returns with lower risk than what those returns would normally entail. We accomplish this
through a time-tested statistical arbitrage volatility strategy employed by the Dallas North Capital Fund.
CURRENT OPPORTUNITY SET
As Q1 2020 has proven, equities and commodities do not always go up. We are facing several volatility-inducing shocks to our economic system including, but not limited to the following:
- COVID-19 has added materially to the arb opportunity
- US Government Debt-overhang
- European bank failures (Italy looks to be next)
- Geo-political issues (Middle East, Turkey/Erdogan, South China Sea, Russian hegemony)
- Most large-scale debt overhangs ended in war, which is not good for investment
The Fund will target to generate positive, uncorrelated returns primarily by exploiting the VRP (Volatility Risk Premium). The CIO has over 25 years experience utilizing similar strategies in derivatives trading and systems management.
- Statistical arbitrage of the Volatility Risk Premium takes advantage of the pricing of risk with these factors at play:
- Interest rates
- Stock prices
- Time value of money (term)
- Standard Deviation of equity returns (though this inefficiency exists across other asset classes)
Targeted launch Q2, 2020.
DNCP Founder Ron Dodson is a 25-year veteran in the capital and equity markets with a demonstrated track record of non-correlated returns while protecting capital.