San Fransico-based startup Titan recently launched an app that allows retail investors to gain access to top hedge fund portfolios with the simplicity of investing in stocks on platforms like Robinhood.
The Titan software determines the top twenty stocks across notable hedge funds, using reported turnover, fund concentrations, and various other attributes. This portfolio is rebalanced on a quarterly basis and the minimum amount that may be invested begins at $1,000, with Titan earning a 1% annual fee on what users invest.
Similar to Robinhood, users can invest in fractional shares, which works to lower the barrier for smaller portfolios to join the platform. Titan currently has over $10 million under management after launching only five months ago.
Titan collects data regarding its users to assess their risk tolerance, using that information to then hedge their investments by shorting the market index. This short can be anywhere between zero to twenty percent, which provides downside protection and generates revenue in case of a crash.
The app utilizes SSL and 256-bit encryption for all data transfers. Funds are insured up to $500,000 at this time, and a middleman custodian named Apex manages the assets. Users may pull their funds within three to four business days, meaning it is within the best interest of Titan to properly manage user portfolios to ensure clients regularly utilize their services.
Titan claims to already have thousands of clients and currently boasts a 10% return YTD, as compared to the S&P 500’s 2%.
In an interview with TechCrunch, Titan co-founder Joe Percoco has noted interest in launching other financial products in the future, which may include international equities, bonds, and cryptocurrency.