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​Important Disclaimers
This article (the “Article”) is for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to purchase any investment or any securities. This Article does not constitute investment advice and is not intended to be relied upon as the basis for an investment decision, and is not, and should not be assumed to be, complete. Readers should make their own investigations and evaluations of the information contained herein. The information contained herein does not take into account the particular investment objectives or financial circumstances of any specific person or entity who may receive it. Each reader should consult its own attorney, business adviser and tax adviser as to legal, business, tax and related matters concerning the information contained herein.  Except where otherwise indicated herein, the information provided herein is based on matters as they exist as of the date of preparation and not as of any future date and will not be updated or otherwise revised to reflect information that subsequently becomes available, or circumstances existing or changes occurring after the date of preparation. Certain information contained in this Article constitutes “forward-looking statements,” which can be identified by the use of forward-looking terminology such as “may,” “will,” “should,” “expect,” “anticipate,”  “target,” “project,” “estimate,” “intend,” “continue” or “believe,” or the negatives thereof or other variations thereon or comparable terminology. Due to various risks and uncertainties, actual events or results may differ materially from those reflected or contemplated in such forward-looking statements. Readers should not rely on these forward-looking statements.  Certain information reflects subjective determinations which may prove to be incorrect. There can be no assurance that the estimates or projections will be accurate or that historical trends will continue. In considering the prior performance information contained herein, readers should bear in mind past performance is not necessarily indicative of future results. All rights reserved. The material may not be reproduced or distributed, in whole or in part, without the prior written permission of PrimeAlpha LLC.

    • Sep 16, 2018

Esoteric Assets Primer - Finding Alpha in a Highly Competitive Market

Esoteric Assets Primer - Finding Alpha in a Highly Competitive Market

Low True Correlation · Higher Alpha · Scalability

Financial markets are fairly efficient – they do not have obvious sources of excess risk-adjusted return – primarily because they are so competitive. But esoteric assets are less-competed assets, improving risk-adjusted return to investors.


Esoteric assets, less traded and unconventional, offer refuge from competitive markets despite illiquidity, presenting high-return opportunities in areas like sovereign receivables, legal finance, atypical jurisdictions, and new asset classes like charter school financing.


Investing in esoteric assets offers potential advantages such as low true correlation, higher alpha, and scalability, stemming from reduced competition and operational structuring, but comes with challenges like high illiquidity, laborious sourcing, and legal novelty risks, presenting a unique opportunity for excess returns driven by lack of competition and illiquidity premiums.


Access the full report to gain insights into the potential advantages, challenges, and risks associated with esoteric assets, and discover investment opportunities in this unique space.



If you do not have a work email address, please email us at info@primealpha.com and we can email you the report directly.



Table of Contents

  • Introduction to Esoteric Assets Primer

  • Competition for Assets Eliminates Risk-Adjusted Return

  • What is an Esoteric Asset?

  • Esoterics as an Alternative for Generating Higher Returns by Avoiding Price Competition

  • What Are The Risks Associated With Esoteric Assets?

  • Who Are The Investment Managers In This Space?




Thanks to our Contributor


Orthogon Partners

information@orthogon.partners

orthogon.partners


Orthogon Partners seeks to generate excess returns from less-competed ("esoteric") assets which have reduced dependence on credit, business, market, rate and other factors of systematic risk. Orthogon's investments in esoteric assets are intended to provide superior returns over broad market conditions with realizations targeted within a five-year period.

Access PrimeAlpha Alternatives Education, Research, and Database of Managers and Investors
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