Topic: [CLOSING...] MOVETO.FUND - MoveTo Growth Fund - page 9. (Read 12886 times)

Good points on all counts, and I certainly understand. My objection was to publicly announce positions, but privately sending them to all shareholders makes perfect sense.

So how about this?

(1) I post a monthly update here publicly on the forums each month with the NAV per share etc.
(2) I send out financials privately to all shareholders with the monthly report
(3) Ideally have both reports signed by a trusted auditor

#1 and #2 I will immediately commit to. #3 I would absolutely desire to do as well, but it depends on when/if the GLBSE allows a read-only login for fund auditors. I will toss this idea to him since it would mean he wouldn't have to audit anything himself, and he could still make a commission off of auditors (or however he wants to structure this feature business-wise).

Great ideas, thanks! Keep them coming. I have updated the FAQ.
-cyto

Thanks for your reply. I'm very glad to know about this.

But in my opinion, your proposition has some parts of it which are "overdoing" while some are not enough.

"Overdoing" part: Nefario with his private key as an escrow. (But I secretly think that bothering him for this will give him an incentive to give transparent funds a higher priority in GLBSE's todo list. Just joking.)

Not enough: Many hedge funds will give their investors information about their portfolio and positions in addition to just the NAV. You might not want to disclose too much information on the forum, or everyone else may read and emulate your strategy. But you could send information to shareholders. If you think 1 share(1BTC) is a too low threshold for people to know your financials, you could issue something like "MOVETO.FUND.MAJOR", which sells, say, 500 BTC each share, of which equals to 500 "MOVETO.FUND" shares, but the shareholders have the privilege of knowing more information than normal "MOVETO.FUND" shareholders.

Hope some part of the suggestions above will be useful to you. Best regards.

I am still thinking about how to best do this. There is a tradeoff between giving out trading information to competitors vs being transparent for investor trust.

In the meantime, I think the way to go is with regular auditing by a trusted third party:

(1) Every month I will post the current NAV (i.e. price per share) NAV per share, # bitcoins I have on reserve for buy-backs, and fees paid
(2) I will get Nefario to look at the fund's account to verify that the information is correct, and that I am following what I have promised in the contract.
(3) Nefario will sign the audit with his private key.
(4) I will post his signed audit here on the forum with my monthly report.

I'm in talks now with him to see if he would be willing to do this for me. Naturally he would charge a fee which would come from my own pocket each month.

Nice. Starting small will make you flexible and agile. Nearly 40% selling at the same day of IPO is also a good sign.

Before the transparent funds are implemented by GLBSE, could you provide us the portfolio information somewhere else? Thanks.

We are now live @ https://glbse.com/asset/view/MOVETO.FUND

381 shares sold thus far - leaving 619 IPO shares available. Hopefully we can get the full 1K sold soon (I personally have a few hundred or so coins I'm still in the process of transferring over). I am also quite excited since we made our first asset purchases today!

Thanks!

Stochastic has in his thread (https://bitcointalksearch.org/topic/glbse-stochasticallycom-dividend-returns-updated-12-times-a-day-74711) a good collection of historic trading data.

Damn, the only problem I'm having now is that I cannot get price data as far back as I would like from twitter (stupid, stupid twitter ).

So I'm not expecting to really be in full-throttle mode until after the first month of operation. That's why I want to start small .

Yep, MU is definitely something we're looking at. We are absolutely a fund-of-funds when it makes sense to do so.

We plan to be Pirate-free from this week. So MU could be white-listed.

This is a great point. Right now no, there is no sector filter - but I will definitely consider adding this soon since it's a great idea.

However, regarding Pirate: I have already filtered out all assets that are associated with his operations. If you want pirate exposure, you'll have to invest elsewhere. Nothing against him personally, it's just that I don't know or understand what he is doing.

Is there any limit to exposure to a single market sector?
For instance, if your algorithm chooses to invest in 10 different pirate bonds you will have less than 20% in any given security but still 100% exposure to Pirates's default.

This is a really good point. I plan to buy-back the shares with my own money though anyway if people want to sell to avoid panic liquidation. I'll try to keep a sizable personal reserve for this purpose, but naturally I don't have an infinite reserve for a real GLBSE catastrophe, such as a major crash event.

I'm hoping that liquidity improves as time goes on and therefore withdrawals will be less of a problem.

It's closer and closer to the fee structure of the "real-world" hedge funds now. Good to know that at least you don't charge an extra 2% of the deposits like other hedge funds do.

There's a potential risk for you however. If there's a panic buy-back demand with a high volume, you will lose a lot of money when you liquidate your position, considering the low liquidity of GLBSE.

5/30/2012 - CONTRACT UPDATED PRIOR TO IPO such that dividends are automatically reinvested into the fund, which is how most hedge funds operate. This ensures the highest possible performance for investors, as well as making MOVETO.FUND a "set it and forget it" type of investment, where clients are not continually having to reinvest their own dividends. (It also has the side effect of making the paperwork easier for everyone, because investors that continually request new shares in order to reinvest their dividends would be very difficult for me to accommodate.)

Here is the final contract:

(0) Each IPO share represents a 1 BTC investment in the fund.
(1) The fund trades and invests solely in securities on the GLBSE.
(2) The maximum concentration in any given security is 20%.
(3) 80% of earnings are reinvested for fund growth, and 20% are paid out as fees to the fund operator. Fees are paid once a month on the first of the month.
(4) The fund operator will buy-back shares on the first of every month upon request to ensure liquidity for exiting MOVETO.FUND. Each share is valued at (1 / # shares) * fund_portfolio_value minus 1% to cover redemption expenses.
(5) New shares may be issued at any time at (1 / # shares) *
fund_portfolio_value price to ensure liquidity for entering MOVETO.FUND

I have notified Nefario of these changes so hopefully the IPO page will change shortly. Naturally after the first share is sold the contract cannot be modified, so I want to make sure I get it right. It's also possible Nefario will require that the IPO be postponed somewhat due this modification.

Either way, I will keep you posted. Take care.
-cyto

A couple updates today:

• Fixed another minor bug today.
• Nefario has approved the fund and it is now listed on the IPO page: https://www.glbse.com/ipo/104

A bunch of updates:

I've been spending today (and plan to spend tomorrow and the next day) reviewing code and resolving bugs. Today I found a minor bug in one of my calculations which I fixed; it did not have a large effect however. Specifically, while constructing price bars of various frequencies from the trade data, one of the frequencies had corrupt data.

Another detail I want to mention is that the "database" is really just a collection of text files at the moment. I update them every day, so over time it will grow as more trades occur, but eventually I will use a real database. Right now, however, there is so little data that text files are sufficient.

Finally, I got a GLBSE contract together that Nefario agrees is good for the fund, here is a copy:

(0) Each IPO share represents a 1 BTC investment in the fund.
(1) The fund trades and invests solely in securities on the GLBSE.
(2) The maximum concentration in any given security is 20%.
(3) Dividends are paid out monthly, on the first of the month.
(4) 40% of earnings are paid out as dividends, 40% are reinvested for
fund growth, and 20% are paid out as fees to the fund operator.
(5) The fund operator will buy-back shares once per month upon request ( after dividends are paid ) to ensure liquidity for exiting MOVETO.FUND. Each
share is valued at (1 / # shares) * fund_portfolio_value minus 1% to
cover redemption expenses.
(6) New shares may be issued at any time at (1 / # shares) *
fund_portfolio_value price to ensure liquidity for entering MOVETO.FUND
--> Contract updated prior to IPO, please see https://bitcointalksearch.org/topic/m.931614

I've been coding away all day today, and am proud to announce that the database and analysis code are completed, so in terms of execution, we are ready to rock and roll right after the IPO!

Update:

I removed the MOVETO.BOND offering (and modified the OP to exclude it) for the following reasons:

(1) There's not enough interest in low-rate/low-risk bonds at the present time
(2) There's not enough capacity on the GLBSE to absorb the extra capital ATM, so aggressive reinvestment makes more sense than paying out margin rates
(3) It's easier / less headache
(4) I can achieve higher returns by modifying the desired risk level inherent in the investment strategy rather than utilizing leverage

Thanks,
-cyto

Thanks for the feedback; this is very useful information.

• Yes, leverage is 100% optional. If I can sell bonds to boost returns, great; if not, that's OK too. The main point of having the split between the fund and bonds is to give investors more options: use the fund if you like risk, or use the bonds if you want a lower return while offloading a portion of direct equity ownership risk onto others.
• I have upped the interest rate on margin bonds to 1%/week per your suggestion in order to be competitive with other similar offerings.
• Regarding short-term buying and selling - right now after looking at the trade logs, I can quickly see that there is virtually no liquidity on the GLBSE, so we're going to have to stick to long-term plays.
• Regarding bootstrapping the fund - I already have a good chunk of BTC that I am personally investing to get me started when I am finished with the backend code.

Thanks,
-cyto