Common questions

Because the account is titled to you and custodied at Interactive Brokers, all tax reporting comes to you directly from IBKR as a consolidated 1099. Quantive doesn't generate any tax document; we're not in the reporting chain. The strategy generates short-term gains by design (holding periods of days to weeks), so realized P&L is treated as ordinary income.

If you have tax questions specific to your situation, loop in your accountant before signing the participation agreement. We're happy to take their questions too.

There's no redemption mechanism because there's no fund. The capital is in your account at IBKR throughout. "Redemption" here just means unlinking the advisor relationship, which you can do at any time with no notice from inside the IBKR portal. Once unlinked, the capital remains in your account and is yours to do with as you wish.

The practical advantage of the separately-managed-account structure is that there's no gate, no lockup, no notice period, and no investor-protection waiver to wait out.

Early participants pay zero fees: no management fee, no performance fee, and no expense pass-through. The arrangement is codified in the participation agreement and binds us for the duration of the early-participation phase.

If fees are introduced later, they apply only to capital that joins after the change. Early participants receive carve-outs to future terms, including commingled funds.

The early-participation phase isn't open-ended. It ends when demonstrable performance can be recycled into a business that becomes economically self-sustaining at standard hedge-fund-style fees. We'll announce the close of the phase with at least thirty days' advance notice.

Two things. First, a mandate to build operational systems that meet client-facing standards. Running the strategy on our own books is one thing; running it across multiple separately-managed accounts, each with its own configuration and reporting, raises the bar on the technology and brokerage integration. Early participation gives us both the reason and the urgency to clear that higher bar.

Second, a track record that extends beyond the principals' own capital. A composite spanning multiple client accounts under the same rule set is meaningfully stronger evidence than performance on a proprietary book alone. Early participants are what take Quantive from a proprietary desk that performs well to a client-facing enterprise with a verifiable, multi-account record.

The strategy is a fundamentals-screened, event-driven, long-only mean-reversion model on a curated universe of US equities. The screen narrows the universe to companies with sound fundamentals: defensible balance sheets, durable cash flow, and clear earnings visibility. Within that universe, the model identifies stocks that have moved substantially away from their statistical equilibrium and takes the contrarian position, sized to the strength of the signal and the volatility of the name.

Very. We model market impact and slippage on every order, interest earned on cash and interest charged on margin, and corporate actions like splits, dividends, mergers, and spin-offs, so simulated fills and balances reflect what would actually have happened. Just as important, the research platform runs on the same real-time market-data interface that drives live execution, which makes look-ahead bias structurally impossible: at any moment the research process sees exactly the data live execution would have had, and no further. Every number that gates a strategy comes from out-of-sample data, never from in-sample results that can be overfit.

We build our systems on a core set of engineering disciplines, and we promote any strategy through four gated stages, each with a high bar it has to clear before it can advance: research; historical simulation with portfolio and risk management; paper trading with shadow reconciliation; and finally live trading. At each stage the strategy is reconciled against what the previous stage said it should do, and any divergence is investigated before it moves forward. Once it's live, it stays under continuous monitoring against the shadow run, and a small set of emergency switches can short-circuit execution, flatten the book at the next available prices, and page an operator to step in if anything looks wrong.

The nature of the strategy also limits how much a problem can cost. This is a medium-to-low-frequency strategy, not a high-frequency one that could lose a large amount in a short window. We trade only a few times a day, and typically a few dozen times over the course of a week, so there is time to catch and correct anything that looks off.

It's a medium-to-low-frequency strategy. We're event-driven, with a 60-day time-triggered stop, and most positions are held for less than two weeks. It is not a long-term buy-and-hold strategy, and it is not high-frequency trading. We trade a few times a day, on the order of a few dozen times a week, and we hold exposures overnight and over the weekend.

The working minimum to participate is $40,000. US regulations require at least $25,000 in net liquidation value for an account to support an active trading strategy like ours; we ask for $40,000 so the account carries a working cushion above that line, which keeps the strategy executing on its intended cadence through normal account movement.

Past the floor, more capital lets the strategy do more. Between $40,000 and roughly $110,000 you'll be on Reg-T margin (2:1), and the strategy will skip signals when the account doesn't have buying power for them. At $110,000 or more with Portfolio Margin enabled, the strategy can take every signal it generates. The strategy section walks through why the funding tier matters.

There's no individual maximum, but the total in early participation is capped at $25 million collectively, provided by no more than 15 participants, including the principals of Quantive Trading.

There's no specific threshold or timeline on which the early-participation phase will close, but you should recognize that our goal is to build a self-sustaining, economically viable business. A business with no revenue is not sustainable, so early participation will close at some point.

That point will be determined by the principals' ability to convert the composite SMA track record into a fee-generating business. Once that operation is underway, we'll phase in a shutdown of early participation to reduce operational overhead. Carve-out terms will let early committed capital roll over with benefits similar to the current offering.

You see what we see, and you see it through IBKR. Every order placed in your account is visible in real time in the IBKR portal under the activity tab. Intraday, you have the live activity feed; daily and monthly, IBKR generates statements consolidating executions, positions, cash balances, fees, margin interest, and any corporate actions. At year-end, IBKR issues a consolidated 1099 sent directly to you, with no involvement from Quantive.

IBKR's reporting is the canonical view of the account, so there's nothing to wait on from us. On our side, the operations team runs real-time monitoring and notification systems (dashboards plus Slack and email) to keep the strategy on cadence and spot anything off the moment it appears. We don't currently commit to a fixed schedule of client-facing reports, but we're happy to discuss access to our real-time reporting on a case-by-case basis. See account structure for how visibility works.

There's no fund yet, only the SMA structure. The capacity limit that matters today is on the strategy itself: how much capital can be deployed across the targeted universe without the strategy's own trading moving the prices it relies on. That limit is in the tens of millions of dollars at current liquidity profiles and is monitored continuously. When the strategy approaches the limit, we close enrollment rather than dilute the signal, and raise funds against other strategies. We expect this limit to be high; the alpha we've proven out is among the most highly liquid US equities, with strong economic fundamentals.

For the current SMA structure, the framework is straightforward: Quantive operates as a state-registered non-professional investment adviser in its home state, and each participant signs a participation agreement incorporating the regulatory disclosures required of an advisory relationship. Quantive doesn't custody client funds; IBKR does.

We're intentionally leveraging a regulatory carve-out for non-professional advisors to accelerate our timeline. Because we're not collecting fees or providing tailored financial advice, there's significantly less compliance burden to offer the strategy for early participation. In this period we can service up to 15 accounts and up to $25 million in AUM. Some seats and capital are earmarked for the two principals of Quantive Trading.

A future commingled or revenue-generating business will need to meet additional compliance requirements before taking on client interests.

The published backtest produces double-digit annualized returns net of realistic transaction costs over the full sample period, with a Sharpe ratio in the range of typical institutional quantitative strategies and a maximum drawdown notably smaller than the equity-market index over the same window. The live track record so far has been consistent with the backtest.

We don't target a specific monthly or annual return number. Targeting a number incentivizes the wrong behavior on the desk (leverage when you're behind, complacency when you're ahead), and the operational discipline exists precisely to avoid those incentives. We target adherence to the rule set and disciplined execution; the returns are what the rule set produces.