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Phoenix Portfolio

The Phoenix Portfolio utilizes a long equity portfolio that employs a distressed value-investment strategy.

The fund takes advantage of structural biases against institutional ownership of financially levered companies with low-stock prices.

We seek companies that have had their stock prices fall 70% or more in the last two years and are often priced below $10 dollars per share. This outcome typically leads to forced selling from their institutional shareholders, creating the opportunity to make outstanding investments for less constrained investors. Generally, these companies are under distress from poor performance caused by temporary factors. These companies generally have elevated levels of debt, and any prolonged period of business stress could cause stockholders to endure substantial losses. The Phoenix Portfolio is a high-risk high-return investment strategy. Please see the Risk of Loss Section of Part 2A of Form ADV referenced below.

The Phoenix Portfolio employs a largely unconstrained approach that seeks to maximize long-term total returns for clients. For example, the firm is not constrained by 

  • market capitalization, 
  • industry, 
  • sector, or 
  • geography in seeking investment opportunities for clients. 

The Phoenix Portfolio invests primarily in common stock positions and depositary receipts (e.g., ADRs), but is permitted to invest in 

  • preferred stock, 
  • convertible bonds, 
  • corporate debt, 
  • exchange traded funds, 
  • REITs, 
  • foreign securities, 
  • and cash in order to execute its investment strategy for clients.

The Phoenix Fund investment strategy will generally have high levels of cash as opportunities to deploy capital in new investments can be limited during times of strong market performance. General we desire to hold stocks for enough time to generate long-term gain treatment for tax purposes. However, the Phoenix Fund will generally sell positions and generate a short-term gain if returns during the short-term period meet our return criteria.

The Phoenix Portfolio is only available to “Qualified Clients” pursuant to section 205(e) of the Investment Advisers Act of 1940 and section 418 of the Dodd-Frank Act.

For more information please see Part 2A of our Form ADV available on the SEC’s website at www.adviserinfo.sec.gov. You may also request a copy from Pelican Bay Capital Management by e-mailing us at info@pelicanbaycap.com.