With 16% Return In June, This ‘Actively Engaged’ Emerging Manager Killed The Indexes

The 2717 Partners fund returned a blistering 16.3% net return for June, its second-best month ever recorded, compared to the S&P 500’s 5% return and Russel 2000's 5.4% return. For August, the 2717 Partners fund returned 5%, versus the Russell 2000’s 7% gain and the S&P 500’s 2% return. Year to date through August, the fund is up 32% net, walloping the Russell’s 7% return and the S&P 500’s 11% gain.

“Actively engaged” positions outperform the most

In his second-quarter letter to investors, which was obtained by Hedge Fund Alpha, Edward Robson said the fund was about 70% invested at the end of the quarter, more than the year’s average levels. He added that their “unique insights and perspective on attractive risk/ reward” continue to inform their position sizing. The fund has seven core positions and several “starter” positions.

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Robson reported three take-outs during Q2, although 2717’s best returns came from its actively engaged campaigns involving management and boards. The fund’s core position in Project Delta skyrocketed about 145% in less than two months after the 2717 team implemented their strategic plan. That included breaking out segment-level numbers, improving the company’s cost structure, and targeting M&A with high returns on investment to grow customer wallet share by expanding the company’s products.