“[Most] investors may be quite willing to take the risk of being wrong in the company of others, while being much more reluctant to take the risk of being right alone.”
- John Maynard Keynes
A PRIVATE FINANCIAL INSTITUTION
Adagio engages in a full complement of financial services providing theoretical research in quantitative finance, quantitative risk analytics, private structured product engineering, fund management, portfolio management, and boutique investment banking services to the entire alternatives space.
We recognize that investment gains and losses aren’t realized in a vacuum and that markets are inherently unpredictable. To overcome these constraints, we accurately measure the risk characteristics of investment opportunities by evaluating their susceptibility to market cycles and operational deficiencies via rigorous four-moment statistical analysis of fundamental systematic and idiosyncratic historical data that—at a minimum—encompass the 2008 financial crisis.
Through effective risk measurement, structure, management, education and communication, we deliver risk-adjusted performance (accounting for illiquidity premia) that demonstrably exceeds what’s otherwise available through the public capital markets. By this standard, we focus on working with institutions, retail advisors, emerging managers across all asset classes, and due diligence firms who share our merit-based values.
“Risk is not a story; it's not a relationship; it's not a feeling. Risk is a number: it's the probability of loss weighted by the expected degree of that loss.”
- Benjamin D. Summers
SERVICES
Third-Party Risk Analytics, Theoretical Track Record Construction, and Capital Introductions
We provide the asset management and broker-dealer communities comprehensive, quantitative risk analysis at both the individual investment and portfolio levels. By applying four-moment statistical analysis to performance data encompassing a minimum of one complete market cycle, we are able to meaningfully measure the risk (market, idiosyncratic, and tail), return, and liquidity characteristics of any investment or portfolio.
We provide the asset management and broker-dealer communities comprehensive, quantitative risk analysis at both the individual investment and portfolio levels. By applying four-moment statistical analysis to performance data encompassing a minimum of one complete market cycle, we are able to meaningfully measure the risk (market, idiosyncratic, and tail), return, and liquidity characteristics of any investment or portfolio.
Summers MEASURE & INVESTMENT CHARACTERISTICS MATRIX
Rigorous quantitative analysis is unequivocally the only responsible method of determining asset quality and informing portfolio construction. Of the risk-adjusted performance measures, the Summers Total Risk-Adjusted Performance Measure is the only one that captures all four statistical moments while providing a user-friendly output as a percentage relative to the market. The Summers Investment Characteristics Matrix paints an accurate, comprehensive picture of the risk, return, and liquidity characteristics of any asset or portfolio regardless of asset class—from equities to real property.
For sponsors managing newer strategies, we are able to construct theoretical track records that ecompasses a complete market cycle by rigorously accounting for every measurable variable that contributes to the overall performance of their rules-based strategy. This methodology does not allow for cherry picking or data fitting.
When asset managers complete our quantitative risk analysis, we provide them capital introductions to the 100,000+ accredited investors and 10,000+ financial institutions within our ecosystem.
For sponsors managing newer strategies, we are able to construct theoretical track records that encompasses a complete market cycle by rigorously accounting for every measurable variable that contributes to the overall performance of their rules-based strategy. This methodology does not allow for cherry picking or data fitting.
When asset managers complete our quantitative risk analysis, we provide them capital introductions to the 100,000+ accredited investors and 10,000+ financial institutions within our ecosystem.
Private Structured Products & Portfolio Management
We serve the institutional space, funds of funds, family offices, retail advisory firms, qualified purchasers, and other intermediaries by engineering both fixed income and growth instruments that meet performance and liquidity goals unachievable through traditional markets.
Product performance is driven by underlying alternative asset managers we advise that have demonstrated the ability to generate substantially better risk-adjusted returns than what are otherwise available through public capital markets as measured across a minimum of one complete market cycle, accounting for all four statistical moments of risk: mean, variance, skewness, and kurtosis.
Most commonly, performance is achieved by applying institutional financial engineering expertise, operational standards, and rigor to arbitrage opportunities generated by inefficiencies in capital and information flows that are inherent to fragmented, small-balance, private, and esoteric markets.
You provide us the return, risk, and liquid mandate; we’ll construct the vehicle(s) to match.
DEFINING CHARACTERISTICS
DEFINING CHARACTERISTICS
Alternative Underlying Assets
24 to 120 Month Lock-Up Period
High Omega Ratio & Low Loss Potential
(as measured since January 2007 or earlier)
Monthly Valuations
Quarterly Reporting
Annual Audits
Margin Facilities
Investment Banking for Alternative Investment Managers
We specialize in working with best-in-class emerging asset managers (e.g. real estate operators, hedge fund managers, etc.) to securitize their strategy under a private structured product (organized as a 506(b) fund) that generates better risk-adjusted performance (as measured across a minimum of one complete market cycle) than what's otherwise available through the public capital markets, after further adjusting for illiquidity.
Further, we establish tailored domestic and/or international distribution for client funds that is able to leverage both traditional broker-dealer and RIA channels, in addition to our proprietary investment club structure, which allows for the utilization of innovative marketing strategies to compliantly aggregate retail investors regardless of whether they meet accredited investor or qualified purchaser status.
The result for our clients is access to unlimited full stack, debt and/or equity capital on their terms through a dedicated fund with full access to the capital markets. All advisory, securitization and distribution fees and expenses are reimbursed upon sufficient capitalization and performance of the fund, resulting in our services becoming ultimately free.
GP Stakes Solutions
Our GP stakes solutions generate unparalleled returns with minimal downside exposure for GP stakes fund LPs by providing best-in-class alternative asset managers a financially engineered structure, rigorous operational guardrails, and access to institutional capital. GP stakes funds acquire equity interests in the discrete structure created for each portfolio asset manager and generate yield via the funds' pro rata ownership of portfolio asset managers' management and performance fees.
We design our GP stakes funds for financial institutions and RIAs that are typically responsible for driving AUM into portfolio asset managers, either directly or through a dedicated fund of funds. This puts GP stakes fund LPs in control of the performance of their positions.
“How much you truly 'believe' in something can be manifested only through what you are willing to risk for it.”
- Nassim N. Taleb
MANAGING PRINCIPALS
Benjamin D. Summers
Managing Director & Founder
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Ben is the Founder and Managing Director of Adagio Group. He has led Adagio to become an innovative financial institution providing fund management and capital financing services across asset classes through its discrete operating structures. Ben has extensive knowledge in quantitative finance, the application of risk engineering principles, and private securities transactions.
Ben also has substantial senior management experience within the global energy services sector. Ben’s transition into energy and finance was preceded by a professional baseball career that began with the San Diego Padres organization.
Ben graduated from Louisiana State University with a Bachelor of Science in Physics having studied Music as a second discipline. He currently holds FINRA Series 65 and Florida Real Estate Licenses, is a member of the Forbes Finance Council, and the author of #1 international bestseller
Karl R. Moore
Managing Partner - Private Equity
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Over Karl's 15+ year career in finance, he has worked across the spectrum of private equity and venture capital markets. He has founded two companies and held senior roles in the launch of two more. In each of these positions, he has proved a top strategic development mind leading and executing M&A and re-capitalization transactions, negotiating deal terms, and getting products and companies to market successfully.
Before focusing solely on private markets, Karl began his career at UBS, eventually focusing on hedge fund manager due diligence at Summit Private Investments. At Summit he optimized the risk-adjusted performance of roughly $500 million in AUM across 40+ managers with strategies ranging from small cap growth and value to distressed debt.
Karl received his law degree from Vanderbilt University and his Bachelor of Science in Business Administration, summa cum laude, from Mississippi College.
Todd A. Billings
Managing Partner - Real Estate
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Todd is the founder of USDV Capital, a private equity firm that has purchased and originated over 9,000 residential and commercial mortgages. Todd launched his career on Wall Street as a financial analyst and trader working with municipal bonds, swap strategies, and equities as a NASDAQ market maker with Merrill Lynch, Paine Webber (UBS), Hill Thompson Magid, and Bank of America Private Bank (U.S. Trust).
Todd is a pioneer in the investment industry being first to market in the non-performing loan business after the 2008 market crash. He followed that up by leveraging his Wall Street experience to finance fix and flip, new construction, bridge and non-agency debt service coverage ratio (“DSCR”) loans.
Todd attended John Hopkins University and received his Bachelor of Science in Economics from Stanford University. He has been married for 21 years and is the proud father of five children.
Daniel Berger
Director - Capital Markets
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Daniel is responsible for market research and communications in support of Adagio’s service offerings, product development and distribution. Before joining Adagio, Daniel served as Chief Revenue Officer at Oren Klaff’s investment firm Intersection Capital with a focus on expanding their equity capital markets practice.
Daniel also has substantial experience in the international real estate development space driving exits from $290 million per year to over $900 million. During that time, he trained more than 3,000 sales and marketing professionals.
Daniel graduated from Europa-Universität Flensburg with a Bachelor of Business Administration (International Management, Media Management, Marketing) and Master of Organizational Management. He is currently a member of the Forbes Business Development Council.
“Choose a job you love, and you will never have to work a day in your life.”
- Confucius
CAREER OPPORTUNITIES
Key Accounts Manager
Level: Senior Manager
Category: Financial Services
Location: TBD
We are seeking a highly motivated Key Accounts Executive with a proven track record of generating new relationships with Independent Broker-Dealers that result in selling agreements nationwide.
For serious consideration, candidates must have experience successfully obtaining selling agreements for sponsors of alternative investment products.
Responsibilities:
- Establish relationships with independent broker-dealers to distribute Adagio's investment products.
- Identify and capture business development opportunities for Adagio’s products.
- Educate broker-dealer firms on quantitative risk analysis and synthetic positions and present alternative investment product offerings.
- Develop and execute a strategic plan to obtain selling agreements with due diligence officers of broker dealers.
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Analyze competitive data and position our products to win selling agreements.
- Establish relationships with independent broker-dealers to distribute Adagio's investment products.
- Identify and capture business development opportunities for Adagio’s products.
- Educate broker-dealer firms on quantitative risk analysis and synthetic positions and present alternative investment product offerings.
- Develop and execute a strategic plan to obtain selling agreements with due diligence officers of broker dealers.
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Analyze competitive data and position our products to win selling agreements.
Qualifications:
- 10+ years financial product wholesale industry experience in the family office space
- Relationships with broker-dealers and other relevant financial investment entities
- Proven strategic business development, negotiating and managerial experience
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Highly refined presentation and public speaking abilities
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Thorough understanding of quantitative risk analysis, structured products and synthetic positions
- Results oriented and creative problem solving ability
- FINRA Series 7 & 66 or Series 65 License
- MBA, MiF or CFA
- 10+ years financial product wholesale industry experience
- Relationships with broker-dealers and other relevant financial investment entities
- Proven strategic business development, negotiating and managerial experience
-
Highly refined presentation and public speaking abilities
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Thorough understanding of quantitative risk analysis, structured products and synthetic positions (education available)
- Results oriented and creative problem solving ability
- FINRA Series 7 & 66 or Series 65 License
- MBA, MiF or CFA
Wholesaler
Level: Associate
Category: Financial Services
Location: TBD
We are seeking an experienced alternative financial products sales professional to be responsible for the distribution of our private securities offerings through the development of Family Office, Registered Investment Adviser ("RIA"), and Independent Broker-Dealer channels. Investment banking, private equity or hedge fund experience preferred.
Responsibilities:
- Attract, retain and support Family Offices, RIAs, and Independent Broker-Dealers as distribution channels for Adagio's private structured products.
- Liaise with distribution channels to guide their understanding of current risk, return & liquidity appetites.
- Educate representatives on quantitative risk analysis and synthetic positions.
- Adhere to communications best practice and disclosure requirements.
- Attract, retain and support Family Offices, RIAs, and Independent Broker-Dealers as distribution channels for Adagio's private structured products.
- Liaise with distribution channels to guide their understanding of current risk, return & liquidity appetites.
- Educate representatives on quantitative risk analysis and synthetic positions.
- Adhere to communications best practice and disclosure requirements.
Required:
- Established network of Family Offices and RIAs that trade/recommend alternatives
- Understanding of quantitative risk analysis, structured products and synthetic positions
- Excellent verbal and written communication skills
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Fortitude to alter cultural inertia with merit
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Creative problem solving ability
- Results oriented
- FINRA Series 7 & 66 or Series 65 License
- MBA, MiF or CFA (preferred)
Financial Advisor Associate
Level: Associate
Category: Financial Services
Location: TBD
Compensation Structure: Commission
Were you unable to grow an economically viable book of business from scratch? If so, you can still be successful in the financial services industry...
As a Financial Advisor, you’ll be part of our entrepreneurial system with the freedom to provide solutions for every type of market participant from a broad portfolio of innovative, merit-based products and services.
We've developed the marketing and sales infrastructure required to take the most difficult aspects of financial sales off your plate.
- No existing book of business required
- No cold calling required
- Low-ticket front-end educational product (segments market participants and provides comprehensive education-based sales message)
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Risk-adjusted performance measure tools and services
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Superior risk-adjusted performance (as measured since January 2007) via institutional-grade private structured products
- Low-minimum access to exclusive risk-adjusted performance for retail investors
- No existing book of business required
- No cold calling required
- Low-ticket front-end educational product (segments market participants and provides comprehensive education-based sales message)
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Risk-adjusted performance measure tools and services
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Superior risk-adjusted performance (as measured since January 2007) via institutional-grade private structured products
- Low-minimum access to exclusive risk-adjusted performance for retail investors
We are seeking a highly motivated Financial Advisor to generate traffic for our self-liquidating marketing and sales funnel and follow-up with individuals who fall out of the funnel to close the appropriate sales.
Commissions are paid at every step of the funnel, in addition to compensation for the sale of our financial products.
You’ll have access to powerful sales tools and a large resource network so you can focus on activities that get immediate results. A career as a Financial Advisor with Adagio gives you the pride and satisfaction of helping others to understand and analyze their financial situation and needs better than any other firm in the market.
Qualifications:
- Highly refined presentation and public speaking abilities
- Thorough understanding of quantitative risk analysis, structured products and synthetic positions (education provided)
- Results oriented and creative problem solving ability
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FINRA Series 65 License (preferred)
- MBA, MiF or CFA (preferred)
- Highly refined presentation and public speaking abilities
- Thorough understanding of quantitative risk analysis, structured products and synthetic positions
- Results oriented and creative problem solving ability
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FINRA Series 7 & 66 or Series 65 License (preferred)
- MBA, MiF or CFA (preferred)
EQUAL OPPORTUNITY EMPLOYER DISCLOSURE: It is the policy of Adagio, LLC to ensure equal employment opportunity without discrimination or harassment on the basis of race, color, religion, creed, age, sex, gender, gender identity or expression, sexual orientation, national origin, citizenship, disability, marital and civil partnership/union status, pregnancy (including unlawful discrimination on the basis of a legally protected pregnancy/maternity leave), veteran status, genetic information or any other legally protected characteristic.
“An investment in knowledge pays the best interest."
- Benjamin Franklin
INVESTOR RELATIONS
We are always seeking creative solutions to effectively meet the demands of important, challenging problems. Two of the most important challenges we address are: 1) measuring the risk-adjusted performance characteristics of assets and asset managers, and 2) filling holes in the capital markets with assets possessing better risk-adjusted performance than what is otherwise available. Adagio's investors range from high net worth individuals to other financial firms with a diverse array of objectives. We pride ourselves on our commitment to open communication with investors and a consistent and high level of transparency regarding our allocations. By fostering an ongoing dialogue and applying our unmatched risk engineering expertise, we are able to structure appropriate vehicles to meet these goals.
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PAPERS
PAPERS
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An Intuitive True Total Risk-Adjusted Performance Measure and Characteristics Matrix
January 2023
Keating and Shadwick’s Omega ratio captures all four statistical moments of risk but has practical limitations with respect to portfolio optimization. Kapsos et al. simplified the Omega ratio into an expression with better practical application, but its focus as a portfolio optimization tool represents a trade-off with respect to absolute risk-adjusted performance measurement. First, we've transformed the Kapsos form of the Omega ratio in an analogous manner to what Modigliani did with the Sharpe ratio to create an intuitive percentage output scaled against the market. Second, we’ve deconstructed the Kapsos form of Omega to create a 3 x 1 matrix that measures and intuitively communicates the three fundamental characteristics that define an investment: risk, return, and liquidity.
Be a Better Fiduciary: Private Structured Products & Quantitative Risk Analytics for Financial Advisors
February 2018
Most financial advisors adhere to a very traditional asset allocation model built entirely upon public securities. Outside of the fact that a set of relatively vague, qualitative criteria govern the literal value of their clients’ life work, the substance upon which those models are predicated is a set of assets completely dependent upon schizophrenic secondary markets...
Investment Banking for Private Real Estate Operators
June 2017
Investment banks are intermediaries that, amongst many other functions, help typically large companies raise capital by advising on and underwriting new securities issues. To prepare for a new issue of securities, investment banks first advise their clients on considerations such as capital structure (how much debt vs. equity should be issued; what types of equity and debt should be issued, etc.), the strategic use of other financial instruments (such as warrants), and...
Investment Clubs: Gain the Exclusive Access of the Top 1%
May 2017
There is a little-known solution that can afford non-accredited investors the opportunity to participate in the exclusive securities offerings of hedge funds and invest like the top one percent: the investment club. An investment club is a business entity structured as either a general partnership or LLC in which all members (owners) are also managers who participate by vote in determining the investment decisions of the club; because all owners actively participate...
Constructing Alpha: An Introduction to the Fundamentals of Risk
April 2017
Every investor — from the guy who bets on physical currency by hiding it under his mattress to Ray Dalio — is concerned with risk. Somewhat surprisingly, despite the fact that the vast majority of people are risk averse, very few have any idea what risk actually means or how to measure it… this group includes many, if not most, financial professionals. Ironically, despite retail investors’ often stated aversion to risk, they tend to solely focus on the projected return...
From Wall Street to Main Street
July 2016
Most real estate investors face the nearly impossible task of competing for the few quality deals in their market against tens, if not hundreds, of deep-pocketed, well-connected and established investors already there. To survive, new and undercapitalized investors are forced to work many fruitless hours blindly mailing, calling, driving and knocking on random doors to find whatever scraps may be left over. After all this effort, in the rare instance a good deal is finally secured...
Introduction to Options in Real Estate
January 2015
One of most prolific and powerful tools of “creative” finance in real estate is the lease-option, but this tool represents only the proverbial tip of the iceberg when it comes to the most powerful breed of derivatives in the investing world, options. There are two basic types of options: the call option (or “call”) and the put option (or “put”). A call is what is utilized in the traditional lease-option; the put, on the other hand, is virtually unheard of in the world or real estate. An option...
Determining Equilibrium Value for Residential Real Estate
March 2013
One of the most pervasive challenges facing the residential real estate market is the determination of property values. As a result of TARP and other federal subsidies to institutional mortgage lenders, in addition to administrative incompetence, the foreclosure pipeline has been clogged. The expected glut of inventory resulting from the mortgage and financial crisis has yet to materialize, and correspondingly, prices have been lifted by artificially limited supply...
Deciphering Monetary Policy as a Means to Beat the Market
October 2012
Monetary policy and its effect on the markets can often seem as an impossibly complex, if not opaque dynamic. The market obviously responds, and most often in a seemingly positive manner, to the actions taken by the Federal Reserve System and statements by its chairman, Ben Bernanke… but how and why, and what are the less obvious effects of a centralized monetary system...
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5100 Westheimer Rd, Ste 115 • Houston, Texas 77056
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This website and its contents including any blogs are a publication of Adagio Group. Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy and it should not be regarded as a complete analysis of the topics discussed. All expressions of opinion reflect the judgment of the authors as of the date of publication and are subject to change.
Adagio Group is not a law firm or a broker/dealer. Readers are advised that articles, blog posts and other content are provided solely for informational purposes. The opinions and analyses included herein are based on sources believed to be reliable and written in good faith, but no representation or warranty, expressed or implied, is made as to their accuracy, completeness, timeliness, or correctness. Neither we nor any information providers Adagio Group may have engaged shall be liable for any errors or inaccuracies, regardless of cause, or the lack of timeliness of, or any delay or interruptions in, the transmission thereof to the users.
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