As of October 2018, Cable Car Capital LLC no longer accepts new separately managed account clients. Cable Car manages a private investment partnership, The Funicular Fund, LP, which is available only to accredited investors. The FAQ below presently describe the old separate accounts structure. New FAQ are forthcoming.
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Yes. While Cable Car encourages prospective clients to establish a direct relationship, certain of its services are available to clients of third-party, unaffiliated investment advisers. Access to Cable Car’s services through a third party may be more appropriate for investors who have established, broader advisory relationships or prefer a more diversified, multi-manager portfolio. Cable Car may act as a subadviser to funds of funds and wealth managers. Cable Car has also entered into a limited licensing arrangement through which it provides trading data to Covestor Ltd. Cable Car’s relationships with third-party investment advisers are non-exclusive and are subject to negotiated terms that may differ from Cable Car’s general mandate. As a matter of policy, Cable Car does not select or recommend third-party investment advisers.
Covestor Ltd is an investment adviser that operates a multi-manager managed account platform. Covestor licenses trade data from investment advisers in exchange for a portion of the management fee charged to its clients. Covestor is a third party unaffiliated with Cable Car that was acquired by Interactive Brokers in 2015.
Cable Car licenses a subset of its trading data to Covestor on a non-exclusive basis for use in managing Covestor’s client portfolios. Clients of Covestor can subscribe to the Hedged Value model portfolio on Covestor’s website. Cable Car maintains a profile and occasional portfolio commentary on Covestor’s website.
Cable Car licenses only a portion of its trading data to Covestor. At this time, Covestor models are limited to highly liquid stocks listed on US exchanges and do not include non-equity securities. Cable Car’s investments in smaller-capitalization securities, stocks listed on international exchanges, derivatives hedges, bonds, illiquid special situations, and other unsuitable investments are not included in the Covestor model. Covestor, under its sole discretion, may replicate trades in the model portfolio for its clients.
Within these constraints, the investment approach is the same, and the Covestor model portfolio managed by Cable Car is included in the Cable Car Composite. Larger-capitalization, US-listed equity positions held by Cable Car clients will generally be held in the model portfolio, although Cable Car undertakes no obligation to license any particular trade opportunity to Covestor. The performance of the model portfolio since August 22, 2013 includes personal account history that predates the formation of Cable Car Capital LLC. Cable Car’s principals have a beneficial interest in the model portfolio used to transmit trading data to Covestor. In keeping with Cable Car’s trade allocation policy, trades in the model portfolio are placed only after being executed for Cable Car’s other client accounts.
Cable Car manages separate accounts open to individual investors in part out of the belief that all investors should have access to hedged strategies. Covestor has a unique approach that is helping to democratize strategies traditionally limited to private pooled vehicles by offering individual investors access to multiple active managers in a single managed account.
As a matter of policy, Cable Car does not select or recommend third-party investment advisers. However, for investors who desire exposure to other managers or strategies, subscribing to Cable Car’s model portfolio as part of a broader asset allocation strategy could be appropriate.
No. Cable Car’s relationship with Covestor is a licensing arrangement. Cable Car’s fiduciary duties are to its clients only. Subscribing to a model portfolio on Covestor does not create a client relationship with Cable Car. Client relationships with Covestor are governed by Covestor’s client agreement.
Yes. Please clearly indicate your status as an existing Covestor client when expressing your interest.