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Graham Capital Management Review

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This review was produced by SmartAsset based on publicly available information. The named firm and its financial professionals have not reviewed, approved, or endorsed this review and are not responsible for its accuracy. Review content is produced by SmartAsset independently of any business relationships that might exist between SmartAsset and the named firm and its financial professionals, and firms and financial professionals having business relationships with SmartAsset receive no special treatment or consideration in SmartAsset’s reviews. This page contains links to SmartAsset’s financial advisor matching tool, which may or may not match you with the firm mentioned in this review or its financial professionals.

Graham Capital Management, L.P.

Founded by Wall Street leader Kenneth Tropin, Graham Capital Management is an alternative investment manager that follows both quantitative (trend-following) and discretionary (go-anywhere) strategies. Its hedge funds have been in the red in recent years, like many other quant investors.  

In 2008, however, the firm was one of the few to predict the fall of Bear, Stearns & Co. and outperform because of its foresight. Currently, the firm manages billions in assets, according to its latest Form ADV. 

Graham Capital Management Background

Tropin started Graham Capital with his own money in 1994, and continues to invest in his firm’s funds. Today, he largely owns the advisory through two entities, while other employees have small stakes. 

The Rowayton, Connecticut headquarters are famously located at “Rock Ledge,” the former home of James Farrell, U.S. Steel president, and birthplace of one of the first business computers. The firm also has offices in London, UK and West Palm Beach, Florida. 

Graham Capital appeared on Institutional Investor’s top 100 hedge fund list in 2016, ranking #56. In 2015, the CME Group and BarclayHedge gave Tropin a lifetime achievement award for his contributions to the managed futures industry.

In 2009, he was No. 15 on Forbes’ list of highest earners on Wall Street. (He reportedly pocketed $120 million from shorting the financial sector.) 

Graham Capital Management Client Types and Minimum Account Sizes

Technically, Graham Capital’s clients are its private hedge and liquidity funds. The investors in these funds are generally "accredited investors," as defined by the Securities Act of 1933, or "qualified purchasers," as defined in the Investment Company Act of 1940. This means pensions, sovereign wealth funds, endowments, foundations and very wealthy individuals. The firm also advises investment companies. 

The firm doesn't specify any minimum account size requirements.  

Services Offered by Graham Capital Management

Graham Capital provides investment management to private funds and investment companies. Its hedge fund strategies are quantitative, discretionary or a blend of both and trade in global currency, commodity and other financial markets. 

The firm is also a registered commodity pool operator and commodity trading advisor under the Commodity Exchange Act. 

Graham Capital Management Investing Philosophy

As mentioned earlier, Graham uses quantitative and discretionary strategies. The former uses computerized mathematical models to find trends in technical information that can be profit opportunities. These strategies may involve high-frequency systems, counter-trend systems and non-trend systems. 

On the other hand, the firm’s discretionary strategies generally involve global macro investments that are non-correlated with traditional assets. Primarily, these investments are traded on major futures exchanges, inter-bank currency and swaps markets, equity exchanges and OTC markets. 

According to its website, the firm’s investment philosophy is based on three pillars:

  1. Strategy diversification
  2. Disciplined risk management
  3. Robust portfolio construction

Fees Under Graham Capital Management

Graham Capital collects management fees that are based a percentage of AUM. Depending on the fund, the annual percentage generally ranges from 0% to 3.5%. Additionally, the firm collects a quarterly performance-based fee that ranges from 0% to 30% of realized and unrealized gains (and losses).

*Estimated investment management fees do not include brokerage, custodial, third-party manager or other fees, which can vary in amount. Fees amounts are based on the firm's maximum annual asset-based fee of 3.50%.
Estimated Investment Management Fees at Graham Capital Management*
Your Assets Graham Capital Management Fee Amount
$500K Up to $17,500
$1MM Up to $35,000
$5MM Up to $175,000
$10MM Up to $350,000

Learn more about advisors' typical costs here.

What to Watch Out For

In its most recent SEC filings, Graham Capital had no disclosures to report. Graham Capital manages assets for accredited investors and investment companies.

It does not work with small or inexperienced investors. It also does not provide financial planning or wealth management services. So if you are looking for a financial advisor who can help steer your personal finances, this firm is not the right fit.

Opening an Account With Graham Capital Management

To contact Graham Capital, call its headquarters at (203) 899-3400. Alternately, you can visit the contact page of the firm's website.

All information was accurate as of the writing of this article. 

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How Long $1mm Lasts in Retirement

SmartAsset's interactive map highlights places where $1 million will last the longest in retirement. Zoom between states and the national map to see the top spots in each region. Also, scroll over any city to learn about the cost of living in retirement for that location.

Rank City Housing Expenses Food Expenses Healthcare Expenses Utilities Expenses Transportation Expenses

Methodology We analyzed data on average expenditures for seniors, cost of living and investment returns to determine how many years of retirement a $1 million nest egg would cover in cities across America.

First, we looked at data from the Bureau of Labor Statistics (BLS) on the average annual expenditures of seniors. We then applied cost of living data from the Council for Community and Economic Research to adjust those national average spending levels based on the costs of each expense category (housing, food, healthcare, utilities, transportation and other) in each city. Using this data, SmartAsset calculated the average cost of living for retirees in the largest U.S. cities.

We assumed the $1 million would grow at a real return (interest minus inflation) of 2%. Then, we divided $1 million by the sum of each of those annual numbers to determine how long $1 million would cover retirement expenses in each of the cities in our study. Cities where $1 million lasted the longest ranked the highest in the study.

Sources: Bureau of Labor Statistics (BLS), Council for Community and Economic Research