|As private hedge funds operating under the guidance of SEC Regulation D Rule 506(c), we are enabled to publicly disclose performance and operations. In fact, above and beyond current regulations, all Unicorn Funds are striving to be fully transparent with investors and the general public by providing the performance, fee structure, legal compliance and business operations directly through the website.|
|The purpose of Unicorn Funds is to create value not only for the investors but also for the global community. We believe that everyone should be able to enjoy the benefit of Unicorn Funds generating revenue. In order to create this win-win scenario, Unicorn Capital Partners donates 20% of its annual fee-revenue to charitable organizations. It is our contribution to the effort of making a difference in this world.|
|Graduated 10% Hurdle Rate|
We strive to offer our investors a fair and transparent fee structure.
The Graduated 10% Hurdle Rate ensures that our interests are aligned with our investors by charging fees based on the returns we produce.
During the year, we charge an annualized 0.5% Management Fee on the last day of the month.
Monthly Management Fee = (0.5%/12) × AUMend of the month
On the last day of the Fiscal Year, or on a Withdrawal or Redemption, the Graduated 10% Hurdle Rate is applied to the Fund's Performance less the Monthly Management Fees already charged. The Performance used to determine the applicable Management Fee and Performance Fee, if any, are assessed only after exceeding the High Water Mark. Thus, the Fees will be broken down as follows:
Graduated 10% Hurdle Rate ("GHR") = Return% × 10
Management Fee = GHR × 2% × AUMend of the year
Performance Fee = GHR × 20% × (Return - Management Fee)
Management Fee = 2% × AUMend of the year
Performance Fee = 20% × (Return - Management Fee)
The problem with the traditional 2/20 fee structure is
it incentivizes the fund manager to focus on increasing the fund’s
Asset Under Management rather than performance.
In this "heads I win, tails you lose" investing environment, fund managers can be rewarded handsomely by simply collecting the management fee from the investors while producing nothing. Fund managers have lost the motivation to perform.
The Solution is to create a 10% Graduated Hurdle Rate on the 2/20 fee structure which ensures fees are dependent on the Fund's performance.
When the return is below 10%, we charge a percentage of the 2/20 fees. For example, if the return is 6%, we only charge 60% of the 2/20 (Return% × 10 × 2/20). When the return is above 10%, we charge a full 2/20 and charge no fees when the return is negative.
|No Administrative Fees|
Unicorn Capital Partners does not charge investors administrative related fees.
As a mean to protect our investors’ profits, we do not charge any legal, accounting, auditing, office rent, IT and other administrative related fees to our investors. Unicorn Capital Partners uses the management fee to cover all the administrative costs.
Unicorn Capital Partners employs an accounting practice to avoid diluting investors’ profits with new capital.
New capital will not be accounted into the Fund’s existing trades; instead, it is held in the Unicorn Pairs Fund’s account until the next new trade. As a result, this accounting practice protects existing Limited Partners’ profits from being diluted by the new capital.
|Near-Zero Monetary Policy|
Peter del Rio
Unicorn Capital Partners, LLC
Unicorn Macro Fund, LP
Peter del Rio has over 30 years experience in Finance and Technology. He began his career at Merrill Lynch Capital Markets in 1982, where he traded the first
Collateralized Mortgage Obligation (CMO) and later traded GNMAs for Merrill Lynch, Dean Witter and Donaldson Lufkin & Jenrette and went on to trade FNMAs and FHLMCs
for Greenwich Capital.
After an illustrious career on Wall Street, he founded IC3D.com in 1996, a 3D CAD/CAM company where he wrote the artificial intelligence to make perfectly fitting clothes. Interactive Custom Clothes Company (IC3D) and Dell Computer were singled out in the 1998 annual report for the Dallas Federal Reserve which wrote the essay, “The Right Stuff America’s Move to Mass Customization.”
After shutting down IC3D in 2003, Peter returned back to Finance where he built the technology to hedge the Zephyr Unicorn Fund and served on the Steering Committee in New York for the risk management organization PRMIA.org. During that time he was invited to the New York Federal Reserve to discuss his VAR algorithm that captured VAR not for a single day but rather captured Value-at-Risk when considering market liquidity. Most recently, Peter is the co-founder and Managing Member of Unicorn Capital Partners, LLC and the Investment Advisor for Unicorn Macro Fund, LP.
Peter earned his BA in Economics and Political Science from Tufts University in 1982.