New York City–based Middlemarch Capital Partners, the registered investment adviser associated with merchant bank Middlemarch Partners, seeks to upsize its MCP Gold LP Fund, a special purpose vehicle that finances the purchase and transport of gold from South America for sale in the Middle East, from its current assets under management of $17.5 million to $20 million.
The principals of Middlemarch Partners began investing in a related gold strategy in 2013 and began offering limited partners the opportunity to invest in MCP Gold in 2017. The fund has since inception consistently produced in excess of 20 percent net returns for its limited partners and offers the option of quarterly redemptions to its investors. The fund has a hard cap at $20 million, and Middlemarch Capital Partners is currently accepting additional limited partners who wish to invest in MCP Gold.
MCP Gold finances the purchases made by a commodities trading firm that buys gold in South America concurrently with a forward contract that has been executed with one of its refining partners in the Middle East. MCP Gold does not speculate on the long-term price of gold as a commodity but rather facilitates trading between regional sellers and institutional buyers of gold.
“We believe gold has a very material place in the global economy, and our role as financial services investors is to finance commodities trading strategies. This investment is structured to limit our exposure to gold price volatility," said Sasha Grutman, a co-founder of Middlemarch Capital Partners.
This investment strategy exploits a global demand for gold and the ability to source relatively small quantities of gold at advantaged pricing.
“Our operating partner has established long-standing relationships with gold sellers in South America who value consistent buying behavior and a professional approach to buying gold,” said Demetris Papademetriou, a co-founder of Middlemarch Capital Partners. “We are able to facilitate a consistent gold supply from licensed gold mining operations to buyers in the Middle East who are supplying significant amounts of gold to Asia.”
MCP Gold is currently open to institutional investors and qualified individual investors.