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Stone Ridge Asset Management

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Stone Ridge Asset Management

Stone Ridge Asset Management

Stone Ridge Asset Management offers its investment advisory services to private and registered funds — and does not advise individuals on their portfolios. Managing more than $13 billion in assets, the New York firm is known for quota share reinsurance investing. Its website says that the firm specializes in “delivering valuable, diversifying return streams sourced from alternative risk exposures – not alpha.” 

In January 2020, it was reported that the firm had begun managing third-party investor assets for reinsurance and insurance-linked securities separate from its mutual funds.

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Stone Ridge Asset Management Background

Since 2012, Stone Ridge has been providing services as a registered investment advisor (RIA). It formed as a limited liability company (LLC) under laws in the state of Delaware. However, it’s based in New York City and has its financial engineering office in Beijing. 

CEO Ross Stevens is the principal owner.

Stone Ridge Asset Management Client Types and Minimum Account Sizes

Stone Ridge’s only current clients are private funds, registered funds, Longtail Holdings and its affiliates. The firm may accept managed account clients in the future. 

Because the firm does not currently work with individual clients, the minimum account size requirement is not applicable. For fund minimums, check the fund prospectus.

Services Offered by Stone Ridge Asset Management Review

Stone Ridge serves as an advisor to a range of investment companies through private or registered funds. When working with these clients, Stone Ridge provides a funds document that describes investment objectives, guidelines and requirements. Such information would be outlined in the fund prospectus.

The firm currently sponsors or administers the following private funds: 

  • Drug Royalties Fund II LLC,
  • Drug Royalties Offshore Fund II LLC
  • Drug Royalties Cayman Fund II LP
  • Stone Ridge Alternative Lending Issuer Trust I

The Drug Royalties Funds are exclusively invested in Oberland Capital Healthcare II LP.  As its name suggests, Stone Ridge Alternative invests in alternative lending-related securities. 

Stone Ridge can provide eligible investors who wish to invest in these private funds with documentation detailing investment strategies, methods of analysis and material risks. 

Stone Ridge Asset Management Investing Philosophy

Stone Ridge utilizes various investment strategies such as reinsurance risk premium, variance risk premium, alternative lending risk premium and factor-based equity risk premium. Generally, though, it takes a passive approach to investing. So it will typically steer away from market timing or buying undervalued securities, believing, as it states, “Competition quickly drives prices to fair value, leaving only risk premium.” Instead, the firm takes on “intentional,” controlled and intelligent risks because “guessing the future is no way to build long-term wealth.” 

Fees Under Stone Ridge Asset Management

Stone Ridge’s fees are non-negotiable and are laid out in each fund’s offering documents. (The firm doesn’t make these public.) Funds may also incur other fees and expenses, including custodial fees and expenses, transfer agency fees and more. 

What to Watch Out For

The firm reported one disclosure on its Form ADV. It involved an alleged violation of a Chicage Mercantile Exchange rule regarding certain exchange-for-related-position transactions during the first half of 2016. In February 2018, Stone Ridge settled the matter and paid a $40,000 fine.

A few other things to note: Stone Ridge does not serve individual clients. It also doesn’t provide financial planning or wealth management advice. For that kind of service, you’ll need to find another firm. 

Opening an Account With Stone Ridge Asset Management

To contact Stone Ridge, send an email to info@stoneridgeam.com, or call the firm at (212) 257-4750.

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

Tips for Rookie Investors 

  • Start with exchange-traded funds. These diversified baskets of stocks trade like stocks but carry less risk. Plus, many have tax benefits. They’re a great way to test the investing waters.
  • Don’t go it alone. Our SmartAsset free matching tool can help you find a financial advisor. It connects you with up to three advisors in your area in five minutes. 

How Many Years $1 Million 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.

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

Methodology To determine how long a $1 million nest egg would cover retirement costs in cities across America, we analyzed data on average expenditures for seniors, cost of living and investment returns.

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%. This reflects the typical return on a conservative investment portfolio. 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