The AdvisorShares Treesdale Rising Rates ETF (NYSE Arca: HDGB) seeks total return while providing protection for investors against loss of principal in a rising interest rate environment. HDGB is managed by Treesdale Partners, LLC (“Portfolio Manager.”) The Portfolio Manager seeks to achieve HDGB’s objective by actively managing a portfolio of primarily Mortgage Backed Securities Interest Only (“MBS IO”) issues. MBS IOs tend to have a negative duration which means they historically have risen in price when interest rates rise. The Portfolio Manager will also attempt to maintain a positive asset yield in a stable interest rate environment.
A portfolio with negative duration generally incurs a loss when interest rates fall. To counter the impact of such potential losses, HDGB’s negative duration may be partly offset by purchasing options on interest rates, as well as taking long positions in U.S. Treasuries.
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HDGB combines two strategies. It seeks to offer portfolio protection in the event of rising interest rates, and also may offer the potential for a positive total return from the mortgage market. These combined objectives may make HDGB a unique complementary holding as a diversifier for both traditional fixed income and equity portfolios that may be adversely impacted in a rising interest rate environment.
Zachary Cooper, Managing Director and Portfolio Manager
Zachary Cooper is a Managing Director of Treesdale Partners, LLC and portfolio manager for the firm's rising rates strategy. Mr. Cooper is a securitized products market veteran with over 18 years of experience across a variety of roles. Prior to joining Treesdale Partners, he was the sole non-agency MBS and ABS trader at The PrinceRidge Group, a boutique investment bank. Prior to that, Mr. Cooper was a Principal at Highland Financial Holdings LLC, a hedge fund with peak AUM of over $1.3B, where he was a senior portfolio manager and on the investment committee. At Highland he specialized in analyzing, trading, and hedging securitized investment products across the capital structure and he also managed the research and model development teams. Mr. Cooper began his career at Deutsche Bank Securities in structuring and analytics where he both coded and ran proprietary securitization models. Later he managed a $2B proprietary MBS derivatives portfolio and ran the structuring and trading of a highly profitable franchise loan securitization effort. Mr. Cooper received a B.A. in Computer Science from Harvard University and earned the Chartered Financial Analyst designation.
Yung Lim, Managing Partner and Portfolio Manager
Yung Lim is Co-Founder and a Managing Partner of Treesdale Partners, LLC, where he sits on the executive investment committee of the multi-manager and direct investment funds. He has over twenty five years of experience in the fixed income and related markets serving in various roles including investment advisory, risk management, and development of sophisticated trading strategies. Since 2002, Mr. Lim has co-managed or overseen various fixed income focused strategies including Treesdale Rising Rates Strategy, Treesdale Fixed Income Fund, Treesdale Recovery Fund and Treebrook Macro Fund.
In the early 1990s, Mr. Lim worked at Merrill Lynch as vice president in charge of risk management for the mortgage desk, typically handling $5 billion in inventory. After Merrill Lynch, Mr. Lim was a senior consultant at Andrew Davidson & Co., Inc., a premier consulting firm specializing in fixed income markets, where he performed advisory work for major financial institutions. Mr. Lim has co-authored a book on advanced valuation and analysis techniques for mortgage securities titled
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*Although the Fund is effective, it has not yet launched and is not available for sale at this time.
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