Firm Overview
KStone Partners LLC is a registered investment adviser under Section 203 (c) of the Investment Company Act of 1940 that provides funds of hedge funds to high net worth and institutional investors. KStone seeks to produce an attractive risk adjusted return for its clients and constructs portfolios that have lower volatility, higher alpha and low correlations to the equity and fixed income markets. KStone has the expertise to design and implement a customized account for an investor.
KStone Partners LLC is a privately owned alternative asset management company founded in 2008
Advisory Board (1)
Elizabeth T. Marren served as Vice President and Associate General Counsel of UST Inc., a $12 billion holding company for U.S. Smokeless Tobacco Company and other entities, until she retired in 2009 when UST merged with Altria Group, Richmond, Virginia. With almost 30 years of product liability experience, Ms. Marren had global responsibility for tobacco and health litigation, legal affairs relating to the manufacturing, science and technology of smokeless tobacco products, intellectual property, public affairs advocacy and compliance activities. She also served as chief regulatory counsel interfacing with various federal agencies. Further, Ms. Marren was Senior Vice President and General Counsel of International Smokeless Tobacco Company, providing legal, regulatory and strategic guidance to international operations.
Ms. Marren began her legal career at Shea & Gould, New York, New York.
She is a New York attorney admitted to practice before various state and federal courts, including The Supreme Court of the United States.
Elizabeth Marren was born in New York, New York and grew up in White Plains, New York. She graduated from School of the Holy Child, Rye, New York and attended St. Mary’s College, Notre Dame, Indiana, receiving a BBA in 1977. Ms. Marren received a JD degree from Fordham University School of Law in 1980.
Currently, Ms. Marren is a Trustee of the Gregorian University Foundation as well as a member of the Neurology Advisory Council of Columbia University Irving Medical Center. Previously, she served as a Trustee of Cristo Rey New York High School and Catholic Big Brothers and Big Sisters, New York, New York. From 2000-2007, Ms. Marren served as Chair of the Board of Trustees of School of the Holy Child, Rye, New York.
For the last several years, Ms. Marren has served as Legal Expert, international trade law, for the Holy See Mission to the United Nations.
(1) KStone Partners LLC has established an advisory board that provides KStone Partners LLC with non-binding advice relating to various matters, including the investment objectives of its Funds. Members of the advisory board have no role in the active operations of KStone Partners LLC, its Funds, the selection or monitoring of any of the Funds underlying investments or advice given to any clients. The Advisory Board currently consists of: Elizabeth T. Marren, Bill Whelan and David S. Marren.
Bill was born in New York City and grew up in New Rochelle, NY. He graduated from Fordham Prep, a Jesuit high school in the Bronx, and received a B.A., with distinction, from the University of Virginia in 1980 and a J.D. cum laude from Fordham Law School in 1983, where he was Managing Editor of the Fordham Law Review. After a clerkship with Hon. William H. Timbers of the U.S. Court of Appeals for the Second Circuit, he joined Cravath, Swaine & Moore in 1984. Bill was elected a senior attorney in 1990 and became a partner in 1998.
While he was a partner, Bill served for various terms as the leader of the Capital Markets practice, the Managing Partner of Administration and leader of the corporate Continuing Legal Education training program. He was a generalist corporate lawyer who advised on a broad range of corporate issues, including corporate governance and public company disclosure obligations. In addition, Bill represented clients in initial public offerings, high-yield and investment grade debt offerings and follow-on equity offerings. Bill was named Best Lawyers’ 2012 New York City “Lawyer of the Year” for Securities/Capital Markets Law. Bill was cited as one of the country’s leading practitioners in capital markets transactions for over a decade by, among others, Chambers USA, Chambers Global, The Legal 500, IFLR1000, The Best Lawyers in America and Lawdragon’s list of the “500 Leading Lawyers in America.” Bill retired in December 2019 after 35 years at Cravath.
Bill and his wife Susan (also an attorney) have been married for 36 years and live in Rye, NY. They have six adult children and nine (and increasing!) grandchildren. They split their time between Rye and Sea Pines in Hilton Head Island, SC. Bill serves as Chairman of the Board of Trustees of the Gregorian University Foundation, a U.S.-based foundation established to support the Pontifical Gregorian University Consortium in Rome. He served for seven years on the Board of Directors of Good Shepherd Services, a NYC non-profit agency founded by the Sisters of the Good Shepherd in 1947. Bill also served as a member of the Board of Trustees of Fordham Prep for six years.
(1) KStone Partners LLC has established an advisory board that provides KStone Partners LLC with non-binding advice relating to various matters, including the investment objectives of its Funds. Members of the advisory board have no role in the active operations of KStone Partners LLC, its Funds, the selection or monitoring of any of the Funds underlying investments or advice given to any clients. The Advisory Board currently consists of: Elizabeth T. Marren, Bill Whelan and David S. Marren.
David was born in Bronx, NY and raised in White Plains, NY. After graduating from Iona Preparatory School in New Rochelle, NY, he attended Bucknell University. He graduated in 1983 with a BSBA, majoring in accounting. Upon graduation, David started work at Bear Stearns & Co., where he spent his entire working career. He earned his MBA in Finance from Pace University while working.
David was one of the youngest to achieve Senior Managing Director in 1993. He became co-head of the Fixed Income Finance Desk in 1995. The trading of United States Strip Coupons , a small niche of the treasury market, was his specialty. While at Bear Stearns, David was a member of the Fixed Income Advisory Board of The Bond Market Association. He remained co-head of the desk until March 2008, when Bear Stearns was acquired by JP Morgan Chase. Shortly after that, David departed on disability. He has remained active in the financial markets.
He has a rare neurological disease, Primary Lateral Sclerosis (PLS). This rare disease has led him to his involvement with two advisory boards. Since 2013, David has been a member of the Neurology Advisory Council of Columbia University Irving Medical Center and more recently, joined the committee for The PLS Natural History Study at Columbia Presbyterian. He is the author of “Bear Tracks”, a book published in 2015 about his experiences at Bear Stearns and living with PLS.
David and his wife Caroline have been married for 33 years. They reside in Darien, CT. and also spend time at their home in Chatham, MA. David and Caroline have four children.
(1) KStone Partners LLC has established an advisory board that provides KStone Partners LLC with non-binding advice relating to various matters, including the investment objectives of its Funds. Members of the advisory board have no role in the active operations of KStone Partners LLC, its Funds, the selection or monitoring of any of the Funds underlying investments or advice given to any clients. The Advisory Board currently consists of: Elizabeth T. Marren, Bill Whelan and David S. Marren.
Investment Philosophy
KStone seeks to generate superior risk-adjusted returns in all economic environments
KStone seeks to generate absolute, above average risk-adjusted returns for institutions and high net worth individuals by constructing low volatility portfolios with low correlations to the equity and fixed income markets
KStone’s portfolios are primarily invested with managers that have track records of generating superior risk-adjusted returns and, generally, manage funds with assets less than $1 billion.
KStone seeks to invest in portfolio managers that have marketable securities underlying their strategies.
Investment Process
The process starts with our investment philosophy and
includes four major stages
Investment Highlights
KStone aims to deliver superior investment results for a given level of risk
KStone seeks to achieve returns that exceed the risk-free rate of return, with volatility similar to fixed income markets.
Historically, the portfolios that KStone manages have generated superior risk-adjusted returns. Generally, KStone’s portfolios are not dependent on the performance of the equity markets for returns.
KStone seeks to mitigate risk by having the sources of return be diverse and not correlated to interest rate movement.
KStone’s primary focus is on risk management at the portfolio and underlying manager levels and KStone seeks to control volatility and preserve investors’ capital.
KStone’s CIO has substantial and diverse business and investment experience.
Potential Benefits of Investing in
Funds of Hedge Funds
Potentially Better Risk-Adjusted Returns
May be able to generate alpha through manager selection, portfolio construction and active oversight
Volatility
Investors benefit from consistency and compounding rather than magnitude of returns
Price for Alternative Investment Products Benefits
Incremental fees are modest compared to substantial additional benefits to investors
Access
Enables investors to invest in hedge funds that they would otherwise not be able to access
Risk Reduction
- Generally, funds of hedge funds have lower correlations to equity and fixed income markets than individual hedge funds
- Non-directional hedge funds are a different asset class from traditional asset classes
- Limits downside risk of an individual hedge fund blowup
Expertise, Due Diligence & Monitoring Requirements
- Hedge funds are complex and require in-depth analysis and expertise
- Substantial time commitment is required prior to investing and once invested
Diversification
- Fund of hedge fund diversification likely more effective than investor just adding direct fund investments
- Different hedge fund strategies work better at different times so having a diversified portfolio of strategies is desirable
- Permits diversification that is not possible given high minimum investments for most hedge funds
Informational Advantage
Constant monitoring of markets and alternative strategies allows funds of hedge funds management to shift among strategies quickly and efficiently to take advantage of opportunities
KStone Partners’ Team
KStone has assembled a talented team with significant relevant experience
Joseph H. Marren
President, Chief Executive Officer, Chief Investment Officer and Chief Compliance Officer
Mr. Marren is the President, Chief Executive Officer and Chief Investment Officer and Chief Compliance Officer of KStone Partners LCC. Mr. Marren’s career as an investment banking professional gives him insight into mergers, acquisitions and private equity investing through a broad range of financial structures and securities. For more than 23 years, he specialized in identifying attractive investment opportunities for corporations, financial sponsors and entrepreneurs and assisting in the execution of M&A transactions.
Mr. Marren joined the General Partner in October 2008. From April 2005 until September 2008, Mr. Marren was Managing Director and Head of the Strategic Opportunities Group at Sagent Advisors, Inc., a privately-owned M&A advisory boutique based in New York City. From May 2001 to March 2005, Mr. Marren was a Managing Director and the Global Head of M&A Business Development at Citigroup Global Markets. He held the same position at Credit Suisse First Boston from November 2000 to March 2001, and was also a Managing Director and the Head of the Business Development Group at Donaldson Lufkin & Jenrette from mid-1997 to November 2000.
Prior to joining Donaldson Lufkin & Jenrette, Mr. Marren worked at The Bridgeford Group, Prudential Securities and Kidder Peabody & Co. He led, or was a senior professional, in the business development efforts for the M&A group at these firms.
Before moving to Wall Street in 1985, Mr. Marren worked for six years at American Maize-Products Company, a diversified publicly-traded conglomerate. He was directly involved in business development activities there. Mr. Marren began his career in 1976 at Price Waterhouse.
Mr. Marren has taught a course in Mergers & Acquisitions as an Adjunct Professor at New York University Stern School of Business. He has guest lectured at Fordham Law School, Columbia Law School and Columbia Business School. He is the author of Mergers & Acquisitions: A Valuation Handbook and Mergers & Acquisitions: Will You Overpay?.
Mr. Marren received a Bachelor of Business Administration degree from the College of William & Mary in 1976, a Juris Doctor degree from Fordham University School of Law in 1979 and an MBA from the NYU Stern School of Business in 1984. He is a member of the New York State Bar Association.
In 2017, Mr. Marren joined the Advisory Board of IBP Institute, which has developed the investment banking professional credential.
Joseph M. Marren
Vice President
Jeanette M. Martin
Director of Finance
Gerald Molinari
Chief Financial Officer
Caroline Marren
Research Analyst