A longtime investor is sticking with oil and gas with his new Raleigh hedge fund, despite an increase in industry attention – and dollars – on renewable energy.
Mark Corigliano, an eight-year veteran at DUMAC (formerly Duke Management Company), started Corigliano Investment Advisors last year with ambitions of a $100 million vehicle, to be called Energy Security Fund L.P.
But a year after launching the long/short energy fund, securities filings show Corigliano has closed only about $8.2 million from 13 investors. Last year, he told Triangle Business Journal he was expecting an initial $10 million that would swell to $100 million by the end of 2023.
While Corigliano said the fund is worth about $10 million when you account for performance, he said there have been some challenges over the past year in securing capital and that plans have shifted as a result.
One constraint – that Corigliano is not offering an offshore fund for international investors, something he hopes to get up and running eventually, pending demand. But the biggest challenge is in how the fund is structured.
At the center of the strategy is oil and gas, “which means many institutional investors will have trouble investing in it,” he said.
Corigliano said that he has no plans to shift the strategy and is still confident in the business proposition.
“Part of the investment strategy is to take a more skeptical view of some of the more emerging technologies but also look for a small number of individual opportunities that could benefit from the growth in renewables as well as the huge amount of government incentives that are available today,” he said. “But the main focus of the fund is oil and gas and oil and gas services, which is really my core competence.”
Long-short equity is a strategy where a long position in underpriced stocks is taken, all while selling short overpriced shares.
The strategy is supposed to minimize market exposure while profiting from stock gains in long positions along with the price declines in the short positions. Right now, Corigliano is the firm’s sole employee, though he expects to add another person later this year.
Corigliano, the former private capital team head for Duke University’s endowment, has a long history in the energy space. He started his career working as an engineer in offshore oil rigs in the Gulf of Mexico. At Duke University, he specialized in investing in commodity markets and energy-focused private equity.
Previously, Corigliano cofounded a firm called Belltower Advisors that also invested in the energy sector. That fund, named for the iconic clock tower on the UNC-Chapel Hill campus, shuttered in 2012.
