Simpson Thacher represented AQR Trend Total Return Fund (the “Fund”), a mutual fund that is a series of an open-end management investment company registered under the 1940 Act, in connection with its launch and continuous public offering. AQR Capital Management, LLC is the Fund’s investment adviser.
The Fund pursues its investment objective by allocating assets among four major asset classes (commodities, currencies, equities and fixed income) by taking long and short positions in futures contracts, swaps or other derivatives and equities. The Fund seeks to provide investors with two different sources of return: 1) strategic exposure to equity markets, and 2) the potential gains from a trend-following approach. Within the Fund’s exposure to equity markets, AQR, on average, intends to target a portfolio beta of approximately 0.5 to the equity market. Within the Fund’s trend-following approach, AQR uses a proprietary, systematic, and quantitative process which seeks to benefit from price trends in commodity, currency, equity, volatility, credit, and fixed income instruments. As part of this process, the Fund will take either a long or short position in a given instrument. The size and type (long or short) of the position taken will relate to various factors, including AQR’s systematic assessment of a trend, utilizing both price and fundamental data, and its likelihood of continuing as well as AQR’s estimate of the instrument’s risk.
The Simpson Thacher team included David Blass, Ryan Brizek, John Fitzgerald, Andy Madore and Nico Valderrama (Registered Funds); and Jon Cantor and Michael Slomovics (Tax).