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This program is only available for Qualified Eligible Persons (QEP). What is QEP?

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PLEASE NOTE: ALTAVRA does NOT charge a load, upfront or initial fee on any account. 

 

Dr. Hanming Rao designed the Typhon Capital Management "Thousand Mile Horse" program with investor liquidity being the foremost priority. The program employs a proprietary quantitative system to trade short-term S&P 500 futures and options on futures, which are some of the most liquid instruments in the world. The program may also trade other highly liquid products as the strategy evolves under Dr. Hanming Rao’s direction.

 

While many industry professionals and investors have an innate fear for selling options, roughly 80% of all options expire worthless, which means there is a significant opportunity to capitalize from this fact, if a system can minimize the tail risk associated with options being exercised against it negating the premiums collected. Dr. Hanming Rao has designed the Typhon Capital Thousand Mile Horse Program to attempt to do just that. The Program mathematically identifies short-term market conditions using historical pricing data, a volatility matrix, option chains, and pattern-matching techniques to attempt to identify and exploit market inefficiencies. It attempts to sell puts at local bottoms, sell calls at local tops, and sell strangles during range-bound markets. It sometimes also will trade futures on an outright or hedged basis. At all times, the Thousand Mile Horse Program is trying to identify the best risk versus reward balance by comparing current pricing data with historical scenarios to generate trade signals.

 

Despite having some characteristics of a pure premium selling program, the Thousand Mile Horse Program offered by Typhon Capital Management differs substantially and operates more as a directional prediction program combined with a volatility measure. The Program typically trades options within six weeks of expiration to minimize the time that positions are open and thus exposed to event risk. The Program continuously monitors the risk/reward ratio on open and potential

 

The Typhon Capital Thousand Mile Horse Program has been designed to perform favorably in many market dynamics. When the program has sold options, a drop in volatility after a position has been established is typically favorable (given all other factors being equal). However, the converse is not necessarily true, and the Program can oftentimes benefit when volatility is rising or the market is trending. In fact, in certain scenarios the Program’s best performance can come in these trendy or volatile markets, when it correctly predicts the direction.

 

However, sharp trends or volatility reversals may cause the system to exit positions, hedge significantly, or reduce leverage in an attempt to reduce volatility risk and potential drawdowns. During an adverse move, the Program will generally follow one of three processes to attempt to mitigate losses:

 

 

Typhon Capital Management believes this program is best suited for investors who are seeking a diversified return stream that is negatively correlated to the S&P 500 and complementary to most trend following strategies. Investing in the Program bears many risks, though, which are disclosed throughout the disclosure document, and potential investors should carefully consider these risk factors and balance them against the Program’s profit potential before investing in the Program.

 

Typhon Capital Management, LLC (“Typhon”) is registered as a 4.7 Exempt Commodity Trading Advisor and a Commodity Pool Operator with the National Futures Association. Typhon operates the Typhon Thousand-Mile Horse Program (“the Program”) in conjunction with its sub-advisor, Global Sigma Group, LLC for Qualified Eligible Purchasers only. Global Sigma Group, LLC (“Global Sigma”) is registered as a 4.7 Exempt Commodity Trading Advisor (“CTA”) with the Commodity Futures Trading Commission (“CFTC”) and the National Futures Association (“NFA”). Global Sigma became registered as a CTA and became a member of the (“NFA”) in March 2010 and began trading the Program in November 2009 on an exempt basis. Global Sigma’s business records are kept at the above address and clients may not inspect the trading records of Global Sigma except at the discretion of Global Sigma. Throughout this document Typhon and Global Sigma may be jointly referred to as “the Advisors.”

 

Global Sigma Group, LLC is led by Dr. Hanming Rao. Dr. Rao has an extensive analytical background across engineering, physics, mathematics, and trading. He became accomplished in the pure sciences at a young age, winning the best experiment prize, and second place overall in the Olympiad Physics Competition in Guangdong Province, China, and 17th place in the overall national competition at age 16. He proceeded to complete a world class education, earning a Bachelors of Science in Electronic Engineering from Tsinghua University in Beijing, China in 1997, a Masters of Science in Computer Sciences from Harvard University in 1998, and a PhD from Harvard in 2005. For Dr. Rao’s thesis, Theory and Implementation of a Truly Random Number Generator, he designed an algorithm and engineered a device to extract randomness from Polonium-210, a radioactive element that emits alpha particles.

 

Upon completing his formal education, Dr. Hanming Rao began his career in the financial industry as a quantitative researcher for Ellington Management Group, a Greenwich, Connecticut-based hedge fund with several billion dollars in assets under management in February 2005. In June 2006, he moved to SAC Capital Management, a multi-billion dollar hedge fund, in New York, New York and worked as a global macro trader and analyst. He initially focused on trading a variety of liquid assets including currencies, interest rate swaps, global equity indices and ETFs, commodities and related ETFs, and options across those asset classes. Then, in May 2008, he was elevated to an asset management role at SAC’s Connecticut headquarters. There, he was in charge of managing SAC’s legacy assets including foreign bonds, junk bonds, convertible bonds, high yield bonds, government CDSs, corporate CDSs, and high yield indices. In January 2009, Dr. Rao moved to Millennium Partners to serve as a VP responsible for the development of statistical models for futures and ETFs, before setting out to start Global Sigma to provide independent investment advisory services to outside clients.

 

Mr. Koutoulas has a broad background across the hedge fund industry, including alternative investment analysis, risk management, corporate finance, securities law, IT/software development, and marketing honed through his experience managing eight startups. He has supervised the trading of several alternative investment strategies, served as the COO and chief analyst of a boutique fund of funds provider, was the head of operations and software development at a market and operational risk firm, and ran an IT and management consulting company with national operations. James earned his law degree from Northwestern Law where he specialized in securities law. He also has a degree in Finance from the University of Florida, where he was a National Merit Scholar and AP National Scholar. He currently provides for the US operations, legal, compliance and business development operations of Typhon Capital Management.

 

The descriptions above are from the manager’s disclosure document.

 

THE RISK OF LOSS IN TRADING FUTURES, OPTIONS AND OFF-EXCHANGE FOREX CAN BE SUBSTANTIAL.  PAST RESULTS ARE NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.  PLEASE READ THE CTA'S RISK DISCLOSURE DOCUMENT CAREFULLY BEFORE INVESTING MONEY. 

 

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