Cabana Black

A private hedge fund offering from Cabana Black, LLC.

Cabana Asset Management, the fund adviser, is an SEC registered investment adviser that strives to make investing simple, transparent and less stressful, allowing investors to remain disciplined and focused on long term results. Cabana introduced, what we believe is, the industry’s first-ever Target Drawdown investment approach in 2012 and the Target Drawdown Professional Series is the firm’s signature product offering.

By primarily leveraging Cabana’s Cyclical Asset Reallocation Algorithm (CARA), which allocates according to changes in the economic cycle, Cabana Black targets elevated performance using techniques not available in traditional accounts. Cabana Black also seeks to take advantage of unique circumstances or opportunities that may arise outside the fund’s traditional strategy.

Learn more about Cabana Black View Cabana Black Fact Sheet

Frequenty Asked Questions

Hedge funds are financial partnerships that establish alternative investments using pooled funds that employ different strategies to earn active return, or alpha, for their investors. The pool of capital is contributed by sophisticated high net worth accredited investors and institutional investors. In short, it is the marriage of a professional fund manager (General Partner) and the investors (Limited Partner). 

The fund strategy is derived from Cabana’s signature Target Drawdown Professional Series, which is a family of tactical, risk-based portfolios. The foundation of all Cabana portfolios and funds is our proprietary Cyclical Asset Reallocation Algorithm (CARA). CARA evaluates the economic cycle and signals reallocation as perceived conditions change. 

While Cabana’s signature Target Drawdown strategies concentrate primarily on loss prevention, Cabana Black emphasizes return maximization by utilizing portfolio leverage through borrowed capital. 

On September 17, 2020, Cabana released a series of Target Drawdown ETFs, which are comprised of an optimal mix of broad asset-class ETFs (an ETF of ETFs). Beginning November 1, 2020 Cabana Black is typically 100% invested in TDSC (the Target Drawdown 10 ETF). By allocating to a Target Drawdown ETF, Cabana strives to provide a more tax-efficient hedge fund solution. Cabana Black also utilizes portfolio leverage by investing borrowed capital. There are times in the market cycle when Cabana Black may not be invested in TDSC. This may be the result of certain market conditions or other perceived circumstances where another strategy could be advantageous. More information on when this occurs can be directed to the Cabana team at info@thecabanagroup.com. 

Cabana Black utilizes portfolio leverage by investing borrowed capital, combined with Cabana’s tactical, rules-based risk management process. While leverage increases risk, CARA still actively adjusts the level of risk to market conditions and as a result, risk parameters may be defined at the beginning of the investment process. Cabana believes that this synergy will facilitate outsized gains during favorable market conditions and incremental reduction of risk as conditions deteriorate. When interest rates rise to such a degree and coincident with CARA’s bearish allocation, leverage may be reduced or eliminated until the costs associated with it are again justified. At such times the fund may invest in short-term treasuries or other interest generating assets. 

Investors must qualify as an “accredited investor” as defined in Regulation D under the Securities Act of 1933 and meet the “qualified client” test of Rule 205-3 under the Investment Advisers Act of 1940. The “qualified client” test of Rule 205-3 changed on August 16, 2021, and requires investors to have a net worth in excess of $2,200,000 or make an investment of not less than $1,100,000. In addition, entity investors may be required to submit a financial statement to satisfy this requirement. 

Cabana charges a 1.5% management fee in addition to an Incentive Allocation. Incentive Allocation is 15%, subject to a “High Water Mark” and only charged when clients make money. 

The minimum investment is $250,000. Cabana Black, LLC has the right to waive the minimum investment amount at its discretion. 

There are no restrictions, gates, or “lockups” to exit the fund beyond a quarterly withdrawal with 30 days’ notice. 

Cabana has partnered with Duncan Administration Services, LLC to provide subscription processing and investor screening, offering materials for prospective investors, fund accounting and monthly performance, monthly individual capital account reports, facilitation of self-directed IRA investments in the fund, and investor inquiry responses.  

Cabana Black is formed as a limited partnership, and actual funds were invested in Cabana Black beginning on March 3, 2020. An investment in the fund is an investment in Cabana’s experienced investment management, the Cabana investment philosophy, and the professional expertise of Cabana’s principals: G. Chadd Mason, Louis Shaff, Daniel Ippolito and Chris Carns. 

Fund performance can be found at https://thecabanagroup.com/black/factsheet.  

Please visit thecabanagroup.com for detailed information about the fund’s investment adviser, Cabana Asset Management, the Target Drawdown Professional Series, and its principals. 

Advisors interested in offering Cabana Black to their clients: 

Contact us at cabanablack@thecabanagroup.com or 479-442-6464. Our team will provide you with the fund’s objectives and terms, in addition to accredited investor certification requirements and next steps.

 

Investors interested in Cabana Black: 

Contact your financial advisor for more information about the fund, including accredited investor certification requirements, and to request the private offering memorandum binder. If you do not have a financial advisor, contact us at cabanablack@thecabanagroup.com or 479-442-6464.

This material is for informational purposes only. It is not a recommendation, offer or solicitation to buy or sell any securities of or any interest in Cabana Black Fund, L.P. (“Cabana Black”) and should be considered only in conjunction with the private offering memorandum, the agreement of limited partnership, and the subscription documents of Cabana Black; all of which are available upon request, and should be considered as a whole, in making the investment decision. The firm only transacts business in states where it is properly registered or is excluded or exempted from registration requirements. Registration as an investment adviser is not an endorsement of the firm by securities regulators and does not mean the adviser has achieved a specific level of skill or ability. Reference to Cabana’s Target Drawdown Series of Portfolios (the “Portfolios”) is provided solely for the purpose of explaining the foundation of the Cabana Black strategy. It is not intended to be nor should it be construed to be a performance comparison. While sharing foundation, inherent differences (e.g. leverage) exist between the Cabana Black and the Portfolios, which will materially impact performance. © 2023 Morningstar, Inc. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete, or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.