Stone Ridge Diversified Alternatives Fund Class I (SRDAX)

Overview

The fund operates by focusing on a range of diverse investment strategies, aimed at generating total returns that are not only attractive but also offer diversification beyond traditional stocks and bonds. The core philosophy behind the fund’s approach is to invest in areas that provide compensation for bearing certain risks, known as risk premium strategies. These strategies are carefully selected based on their potential to contribute to the fund’s overall returns while helping to spread risk across various assets and markets.

Products and Services

This fund incorporates a variety of investment strategies, each chosen for its unique risk-return profile and potential to diversify against traditional market risks. The strategies include:

• Reinsurance: This strategy involves investing in reinsurance contracts, a sector known for its risk-bearing potential and capacity to offer returns uncorrelated with broader financial markets. By assuming part of the risk from insurance companies, the fund participates in the insurance market's economics.
• Market Risk Transfer: Engaging in strategies that facilitate the transfer of market risks from those seeking to hedge against these risks to those willing to bear them for a return. This includes investing in instruments and contracts specifically designed for risk-sharing purposes.
• Style Premium Investing: Focused on capturing returns from various market styles such as value, momentum, size, and volatility. This strategy seeks to exploit the long-term potential and risk premiums associated with these different investment styles.
• Alternative Lending: Participating in non-traditional lending markets, including peer-to-peer and direct lending platforms. This approach aims to capture higher yields than those typically available from conventional fixed-income investments, with an acceptable level of risk.
• Single Family Real Estate: Investing in the single-family real estate market by either directly purchasing properties or through vehicles that invest in residential real estate. This strategy seeks to benefit from rental income as well as potential appreciation in property values.
• Bitcoin: Exposure to Bitcoin or related cryptocurrency investments. This part of the portfolio aims to capitalize on the high-return potential of digital currencies while acknowledging and managing the significant volatility and risk associated with this asset class.