FrontFour Capital Group’s Return, AUM, and Holdings

FrontFour Capital Group was launched back in 2006 as an employee owned hedge fund sponsor. It mainly provides its services to pooled investment vehicles and utilizes an event-driven and opportunistic strategy. The fund’s headquarters are in Greenwich, Connecticut and currently is run by David Lorber, Stephen Loukas, and Zachary George. Mr. David A.Lorber, one of the Co-Founders, currently serves as an investment adviser and a Portfolio Manager at the firm. He has extensive experience in restructuring operations and implementing policy changes in the financial and real estate sectors. Prior FrontFour Capital Group, Mr. Lorber served a Senior Investment Analyst at Pirate Capital, was an Equity Analyst at Vantis Capital Management and an Associate at Cushman & Wakefield. Furthermore, he served as a director of Aerojet Rocketdyne Holdings, as a director of Huntingdon Capital Corp and Fisher Communications Inc. David Lorber holds a B.S. in Business Management and Economics, with Honors, from Skidmore College.

Mr. Zachary Ryan George J.D., also known as Zach, is the second Co-Founder, Managing Member, Partner and Portfolio Manager at FrontFour Capital Group. Mr. George earned a Juris Doctor degree from Brooklyn Law School and a Bachelor of Arts in Philosophy from Simon Fraser University in Vancouver. His professional experience in the investment world is extensive. He has been Chief Executive Officer and President of IAT Management. Additionally, he served as President and Chief Executive Officer of Huntingdon Capital Corp and as Interim Chief Executive Officer and Chairman at Slate Office REIT. He was also a Senior Investment Analyst at Pirate Capital and a Credit Analyst at Mizuho Bank. Mr. George has served as an Analyst at CIBC World Markets, and as a Lead Independent Director of PW Eagle Inc.

The third member of FrontFour Capital Group is Stephen Elias Loukas. He earned a Bachelor degree in Accounting and Finance from New York University. Mr. Loukas began his career at financial restructuring in Zolfo Cooper, assisting corporate clients in the implementation of operational and financial restructuring plans. Since then, he has been accumulating experience in the investment area. He has served as Senior Analyst at Pirate Capital, as a Portfolio Manager at Credit Suisse and currently, he is partner and Portfolio Manager at FrontFour Capital Group. He serves as the Independent Director of Obsidian Energy. Before joining FrontFrour Capital, he served as a Director at Credit Suisse Securities and also as a Portfolio Manager and Head of Investment Research of the multi-product event proprietary trading group. Additionally, he was a member of the corporate finance & distribution group at Scotia Capital.

David Lorber FrontFour Capital

FrontFour Capital Group invests with a focus on value event-driven opportunities in the public equity and fixed income markets of the United States and Canada. The firm employs a combination of in-house and external research processes to identify the most attractive opportunities and creates its portfolios based on bottom-up fundamental analysis. According to its latest Form ADV as of February 26th ,2019, the fund manages approximately $207.93 million in regulatory assets on a discretionary basis.

Taking a look at the annual returns of its FrontFour Capital Partners Fund over the past five years we can see that three of those were down years. In 2013, it attained a satisfactory 28.70%; however, in 2014 it brought a loss of 0.80%. The following year, was another down year with a loss of 8.61%. The fund seemed to have recovered for the year 2016 when it brought back 4.89% and got even better in 2017 with a result of 12.61%. From January through October 2018 (YTD), the fund had lost 12.90%. FrontFour Capital Partners Fund achieved a total return of 85.21% with a compound annual return of 5.39%. Its worst drawdown was at 43.31.

Insider Monkey’s flagship strategy identifies the best performing 100 hedge funds at the end of each quarter and invests in their consensus stock picks. This way it is always invested in the best ideas of the best performing hedge funds and is able to generate much higher returns than the market. Since its inception in May 2014, our flagship strategy generated a cumulative return of 89%, beating the S&P 500 ETF (SPY) by 29 percentage points (see the details here). We take a closer look at hedge funds like Froint Four Capital Group in order to identify their best and worst ideas.

At the end of Q4 of 2018, the fund disclosed a total of 19  holdings, and its portfolio was valued at $113.87 million. Even though the fund has a diverse portfolio, none of its holdings were among the 30 most popular stocks. During the quarter, Froint Four Capital Group reduced stakes in 11 companies, among which was Nexstar Media Group Inc. (NASDAQ:NXST). Its position in Nexstar, the fund lowered by 85% to 26,449 shares valued at $2.08 million. Also, it decreased its investments in Builders FirstSource Inc. (NASDAQ:BLDR) by 20% ending up with 171,379 shares worth around $1.87 million, and in Colony Capital, Inc. (NYSE:CLNY) also by 20% to 490,754 shares with a value of $2.3 million.

Among the stocks for which the fund completely lost enthusiasm and decided to sell its entire positions were DowDuDpont Inc. (NYSE:DWDP), Cabot Corp. (NYSE:CBT). Te fund dumped $8.01 million worth a position in DowDuDpont by selling 124,516 shares, and dropped its stake in Cabot Corp that was valued $4.02 million, on the basis of 64,166 shares outstanding.

Click here to read the rest of the article where we share the fund’s top new and old positions.

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This article was originally published at Insider Monkey.