Kosmo Capital GM Ltd

Business Model

TRADING

Kosmo Capital GM’s trading approach is based on scaling up the number of traders and pursuing a contained and well defined daily Profit Target with a low daily Capital at Risk. 

The Implementation of this model is the responsibility of the traders but the Fund Managers have their most critical function in overseeing the risk deployed in the books in real time and shape it in a way that is consistent with the company’s mission. Individual p/l targets for traders start from 100,000 GBP per annum and gradually rise to 500,000 GBP per annum. Company’s Net Result Targets are achieved by scaling up the number of traders as AUM grow organically whilst the individual trading targets remain the same.

PERFORMANCE & REDEMPTION

Kosmo Capital GM has a Zero Fee Policy for investors. KC’s Performance distributed to Investors will be 50% of the Net Yearly Result. Performance Allocated to Investors will be retained within KC and fully reinvested into the AUM each year until Yr 10 (unless redemption is requested).

Investor Performance will be capped at 200,000 GBP or 2 times the initial investment per annum, the over-performance is retained within KC and increases the AUM.

Capital redemption is offered to Investors at the end of each year and before the start of the new trading year commencing after the lock-in period of 3 financial years has elapsed.

Provisions accrued within the company as corporate profit will increase AUM for trading.

If new Investors were to be on-boarded at any point in time their capital contribution will have to be equal or greater than the capital accumulated by the existing Investors up to that point.

P/L target will be 500 GBP a day per Trader in Yr 1 and gradually increasing to a cap of 2,500 GBP Daily. Each new hire starts with a 500 GBP target regardless of the year he/she comes on board.

Risk is managed by Traders at a book level but the Fund Managers have the critical responsibility of overseeing the whole risk of the firm and to actively manage it (see Risk Metrics Doc).

FUND MANAGERS & HIRED TRADERS

Fund Managers and Hired Traders trade FX, FI, Commodities, Indices, Equities, Futures and other liquid linear and non-linear financial products.

FMs are KC shareholders but in some cases may only be directors.

Fund Managers who come on board after Yr1 will have to pay a buy-in fee to be negotiated on a case by case basis and they detract from Initial Investors Return Target.

Traders join on a performance based pay-out agreement with a contract for services (40% commission on Net P/L after Operating Costs). 

Kosmo Capital’s hiring plan is illustrated in the simulation contained in the Annex.

Fund Managers P/L start at 500 GBP daily and grows in time to 2,500 GBP daily.

Hired traders P/L target is 90% of the FM target unless otherwise agreed.

First year P/L target is 500 GBP per day for any new starter.

Total Stop Loss will be 50% of the AUM at the start of each year.

Individual Stop Loss will be 45% of Trading Capital at the start of each year (Capped at 100,000 GBP).

Traders will cease trading if the Individual Stop Loss is hit or the Total Stop Loss is triggered.

Traders are responsible for managing the risk in their own book within set parameters and under the supervision of Fund Managers.

Fund Managers are responsible for overseeing risk in every book and to manage it accordingly.

Fund Managers Salary will be a function of KC’s Net Result up to a maximum of 100,000 GBP per year (see Annex).

Fund Managers can be awarded a bonus if KC’s Net Performance is above budget and for a maximum of 80% of the over-performance for the financial year.

Fund Manager over-performance can be paid out as bonus up to 50% of the over-performance and provided it doesn’t detract from budget AUM.  

Kosmo Capital will distribute dividends to the shareholders up to the tax-free threshold starting from Yr2.

BUY IN

Investment option is only offered to Investors that match a strictly defined profile. ONLY HNWI, UHNWI and highly sophisticated and competent Individuals can invest in KC.

Initial Investors participate in 50% of the revenue generated by KC’s trading and acquire the right to a stock option worth 10% of KC’s Cash Value (pro rata per number of investors) callable in year 10. 

KC aims to return the Initial Investment as a function of KC’s Yearly Net Result as illustrated in the Annex.

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