Potomac Fund Management announced three new initiatives spanning direct indexing, hedge fund investing, and financial-services branding as the firm expands beyond its traditional tactical asset management business.
The announcements were made by CEO Manish Khatta during Potomac’s REMIX conference.
The launches follow a period of significant growth for the firm, which surpassed $5 billion in assets under management earlier this year and added $2 billion in assets over the past nine months.
Potomac is launching a proprietary direct indexing solution that combines integrated tax-loss harvesting with a tactical overlay.
Unlike traditional direct indexing strategies that generally maintain equity exposure, Potomac’s offering is designed to adjust exposure based on the firm’s tactical trading signals.
The solution will initially launch on Potomac Union, the firm’s turnkey asset management platform, before expanding to additional custodians and platforms.
Potomac also plans to launch a hedge fund early next year.
The fund is intended to give the firm’s quantitative models greater flexibility outside the constraints of RIA custodians and traditional ’40 Act mutual fund structures.
The strategy will allow for expanded use of shorting, leverage, and futures.
Potomac said the hedge fund is the result of a two-year incubation period.
It will initially be available to accredited investors, including Potomac advisors investing personal assets, with a $1 million minimum investment.
The firm is also preparing to launch a standalone creative agency focused on fintech companies, asset managers, and large registered investment advisers.
The agency will draw on the internal branding and creative capabilities Potomac has used to support its own growth.
It will focus on high-end brand engagements designed to help financial companies identify their differentiators and communicate their positioning more effectively.
Potomac is headquartered in Bethesda, Maryland, and operates as an SEC-registered investment adviser specializing in quantitative and risk-managed portfolio solutions for financial advisors.
KEY QUOTES:
“Most firms take success and turn it into a bigger org chart. We take success and turn it into new businesses. Every one of these ventures started as a capability we built for ourselves because we couldn’t find exactly what we wanted in the market. Now we’re taking the training wheels off and seeing how far they can go.”
Manish Khatta, CEO of Potomac Fund Management
“We’ve built Potomac by treating brand and creative work as core business functions, and we know firsthand what it takes to create something that stands apart in financial services. Having done it for ourselves, we’re in a strong position to help others do the same.”
Christopher Norton, Chief Marketing Officer of Potomac Fund Management
