Frequently Asked Questions

Logistics

How many clients does Arch Capital Investors Fund have?


Arch Capital currently has 7 clients in the fund.




Do all investors participate in the same fund?


All the money is pooled into one strategy. Returns may vary for each investor based on the timing of their allocation.




What is your reporting process and timing?


Each investor will have access to a web portal that updates their net asset value (NAV) monthly. We also will be sending out quarterly updates and an annual letter along with K-1’s by the end of February of each year.




What is the process to exit the fund?


Deposit/withdrawal periods happen once a month. Withdrawals need a 30-day notice. There is also a 3-year lock-up on first money in (so if someone subscribes in 2021 but does a follow-on in 2023, all money will be eligible for withdrawal in 2024). We don't want this to be money that any investor will/may immediately need. We have put these rules in place to a) incentivize long-term investing, and b) to protect other investors if we have someone with an outsized ownership of the limited partnership.




What is the process for mid-year investments or withdrawals?


Our performance fees are assessed annually. Mid-year investment performance is assessed based on when you put money in. Same goes for mid-year withdrawals.





Strategy

How many different assets/equities do you hold in the portfolio?


We plan to own 8 - 15 common stocks at any one time. Our structure allows us to trade ETFs, bonds, options, etc. but our goal is to keep things simple and own a concentrated book of what we understand well without making things messy.




Will all assets be US equities?


No. The fund is open to trade outside the United States on a variety of exchanges around the world. Our focus is on US equities, since that is the market we know the best, but that may change over time.




Do you hold cash in the portfolio?


Yes, but with no specific guidelines. We view cash as a residual. Our cash balance increases when we have trouble finding businesses we like at a reasonable valuation.




Do you have a higher weight in growth/value? Or Large/Mid/Small Cap?


We do not explicitly look for either being in growth or value bucket, but focus on how much future cash a business will generate relative to what it is trading at today.





Fee Structure

Are all investors under the same fee structure?


Yes. The only caveat is that if you join later in the calendar year, the performance fee is assessed vs. the S&P 500 on the date the subscription is deposited.




Benchmarking against the S&P incentivizes risk. How is this controlled?


There is no doubt that our strategy of holding 8-15 companies may/will have more volatility than the overall market. However, we have the majority of our savings in the fund and don’t plan on taking distributions anytime soon. So while yes, our fee structure could benefit from a high-beta portfolio, over the long-term we have the same goal as our partners: to provide adequate long-term returns for the fund.




What is the fee structure?


Arch Capital has no management fee, and a 33% perforamance fee benchmarked vs. the S&P 500 index. The performance fee is asssesed on an annual basis. If the fund underperforms the S&P 500 in any calendar year no fee is incurred.





Past performance does not guarantee future results. The investment return and principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.

This document is intended for informational purposes and should not be considered as an offering or the solicitation of an offer to purchase an interest in Arch Capital Investors Fund LP (the Fund). Past performance is not a guarantee of future results and there is no assurance that the investment objectives of the Fund will be achieved. An investment in the Fund involves a high degree of risk and is a concentrated strategy that may come with significant volatility compared with other investments. The contents of this website are based upon sources of information believed to be reliable but no warranty or representation, expressed or implied, is given as to their accuracy or completeness. The Fund may invest in foreign securities that involve greater volatility, risks, and differences in accounting methods. The Manager asserts that the reader is solely liable for their interpretation and use of any information contained on this website.