April, 2014 - In This Issue:

From the Mutual Fund Observer article:


"...On whole, the strategy has worked.

Their long portfolio has outperformed the S&P 500 by an average of 5% per year for 14 years. The entire strategy has outperformed the S&P in the long-term and has matched its returns, with less volatility, in the shorter term. Gargoyle has outperformed the S&P500 in 10 of the past 14 years. The fund has also outpaced the S&P500 since its conversion to a mutual fund in April 2012 through January 30, 2014.

Throughout, it has sort of clubbed its actively-managed long-short peers. More significantly, it has substantially outperformed the gargantuan Gateway Fund (GATEX). At $8.3 billion, Gateway is - for many institutions and advisors - the automatic go-to fund for an options-hedged portfolio. It's not clear to me that it should be. Here's the long-term performance of Gateway (green) versus Gargoyle's institutional shares (blue):

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The "Green Shoots" of Spring?


From the Desk of Alan Salzbank
Alan Salzbank, Fund Manager, Riverpark Gargoyle Hedged Value Fund
Alan Salzbank, Portfolio Manager

For many of us here in the Northeast, particularly after a long, cold, snowy Winter, April is met with a sigh of relief and eager anticipation of the beautiful, sun-filled Spring days to come. While I would dearly love to embrace this meteorological optimism, I find that my enthusiasm is tempered by the knowledge that each Spring also brings a renewal of what has become an annual rite of passage called "The Battle of the Front Yard."


You may be familiar with the process. Each year what (hopefully) started as a green, lush expanse of grass in the front yard gradually gives way to the ravages of kids, dogs, weeds, drought and heat waves, until by Fall the battlefield is scarred and pock-marked throughout with patches of bare dirt and mud, which persist in a depressing panorama through Winter. In April we replenish our supplies with bags of grass seed, fertilizer, and various patching products, rallied to action by relentless commericials showing the verdant expanses that could be ours with just a bit of time and effort. Soil is tilled, seeds are sown, fertilizer spread and a battery of hoses and sprinklers is thrown into the fray. Each day we check for progress, anxiously awaiting the first green shoots to break through the bare ground and tell us that our efforts will soon be rewarded and the cycle can begin again. Sometimes we start to see these green shoots even though they are not there...


Looking at an S&P 500 that is once again relentlessly climbing to new highs after a brief dip, I find myself wondering if investors' current optimism is causing them to see nothing but green shoots, overlooking some of the very real warning signs in the macroeconomic picture. Domestically, recent economic data has been lukewarm at best, with certain indicators like new home sales putting in outright poor performances. The political landscape is largely defined by unproductive partisan gridlock. Globally, the events in the Ukraine pose a threat to economic stability and growth that does not seem likely to be resolved any time soon, and carries with it significant tail risk. It is said that the market likes to climb the "wall of worry," and that has certainly been the case recently. Nonetheless, while I will still be working on the lawn this Spring, I will also be carefully tending my hedges.


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 At Gargoyle Investment Advisor L.L.C., we understand the need for investors and portfolio managers to keep pace with the demands of today's ever changing marketplace. For the last 25 years, from our beginnings on the floor of the American Stock Exchange to the establishment of our Investment Advisory and Institutional Option Overlay Service, we have weathered the storms that have shaken the markets and found ways for our clients to prosper in the long term. We will approach the next 25 years with the same commitment to value, performance and service that has been the cornerstone of our success.
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For 25 years, Gargoyle has executed sophisticated options strategies to dynamically hedge equity portfolios. Combining the market savvy of seasoned traders with the disciplined approach of Hedge Fund Professionals, our Management Team delivers for you..
Alan Salzbank

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Gargolye Investment Advisor L.L.C. - Your best option for Insight


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