Nov 11, 2021 · 42m · capital-allocators
Himanshu Gulati – Antara Capital (Manager Meetings, EP.19)
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of Manager Meetings, Corbin Capital Partners CIO Craig Bergstrom interviews Antara Capital founder Himanshu Gulati to explore his opportunistic credit and event-driven equity investment strategy. The conversation covers Gulati's personal background, asymmetric trade structuring, tail-risk hedging protocols, and real-world restructuring case studies.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Ted holds 15.9% of the talking time here. How this is scored →
Ted as informed peer 4.6 Guest teaching 4.8 Guest disagreement 1.2 Ted pushing back 2.2
speaking balance: gold is Ted, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 20:09 Rejecting the 90% win-rate mandate
Himanshu rejects the conventional wisdom passed down by senior industry figures that managers must be right 90% of the time, arguing such portfolios merely hug market indices rather than taking authentic risk.
Hardest push from Ted ▶ 23:47 Critique of trade-construction complexityCraig challenges Himanshu's structuring philosophy by pointing out from his 1990s hedge fund coverage experience that adding layers of legs to trades frequently introduces inadvertent risks without an informational edge.
Biggest teaching moment ▶ 32:55 Casino restructuring case studyHimanshu provides a masterclass on capital preservation and restructuring, detailing how deep out-of-the-money puts and corporate bankruptcy know-how protected capital when hotel revenues completely vanished.
Ted holds their own ▶ 8:17 Bergstrom's framework on hedge fund hotel riskCraig demonstrates allocator sophistication by dissecting the structural flaws in event-driven credit strategies, explaining why overlap in hedge fund hotels causes severe downside air pockets during stress.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Ted as informed peer | Guest teaching | Guest disagreement | Ted pushing back | Why |
|---|---|---|---|---|---|---|
| Overview: Craig Bergstrom Interviews Himanshu Gulati of Antara Capital | 5 | 3 | 1 | 2 | Ted Seides conducts a preliminary diligence interview with allocator Craig Bergstrom about Antara Capital. Craig demonstrates deep institutional diligence knowledge regarding hedge fund beta, position sizing, and co-investment underwriting. | |
| Early Life, Baseball Card Business, and Formative Influences | 3 | 4 | 1 | 1 | Craig hands off to Himanshu Gulati, who recounts his immigrant background and early entrepreneurial lessons trading baseball cards. The discussion is autobiographical and cordial with gentle rapport. | |
| Career Path: Perry Capital, GLG, and Founding Antara | 3 | 5 | 1 | 1 | Himanshu walks through his career trajectory across Perry Capital and GLG/Man Group, contrasting fundamental single-firm investing with platform risk systems. Craig listens attentively without challenging the career narrative. | |
| Balancing Conviction with Humility and Cutting Losses | 6 | 5 | 2 | 4 | Craig probes the tension between conviction and hubris in volatile markets. Himanshu pushes back on conventional industry dogma of requiring a 90% win rate, highlighting that alpha comes from proper position sizing and quick risk cutting at a 65-70% hit rate. | |
| Differentiated Structuring and Asymmetric Trade Design | 4 | 5 | 1 | 2 | Craig asks about Antara's trade structuring methods. Himanshu explains how analyzing volatility, options markets, and cap-structure tiers enables outsized asymmetric upside while protecting capital. | |
| Tail-Risk Hedging, Concentration, and Position Sizing | 6 | 5 | 2 | 5 | Craig delivers sharp pushback, noting that adding complex structural hedges often introduces unhedged ancillary risks outside the manager's core insight. Himanshu defends Antara's capped-loss strategy and disciplined portfolio concentration. | |
| Portfolio Allocation, Team Structure, and Hiring for Humility | 4 | 5 | 1 | 1 | Himanshu outlines his team coverage structure of 35-40 positions divided among senior and junior analysts and explains his hiring philosophy centered on humility and rejecting entitlement. Craig allows Himanshu to elaborate freely. | |
| Thematic Investing: Reopening Plays and Margin Expansion | 5 | 5 | 1 | 2 | Himanshu outlines his reopening thesis around hospitality/entertainment cost-structure reductions and EV/EBITDA valuation discounts. Craig steps in with an informed question on whether these changes were strategic or survival-driven. | |
| Case Study: Restructuring a First-Lien Casino Investment | 5 | 6 | 1 | 2 | Craig and Himanshu examine a co-invested casino first-lien loan trade that experienced a 100% revenue collapse during COVID. Himanshu explains how monetization of tail-risk puts and legal restructuring skills salvaged the investment for strong gains. |
Statements from this episode (15)
Bergstrom: Judging portfolio and risk management skills ex-ante is extremely difficult
“To be honest, I think it's really hard to ex ante Judge portfolio management and risk management skills with any great degree of confidence”
Bergstrom: Hedge fund overlap creates downside air pockets in event-driven strategies
“And I think that's because you end up in a lot of hedge fund hotels. It's a relatively small number of positions with quite high hedge fund ownership and overlap, and that produces a lot of downside air pockets.”
Bergstrom: Corbin Capital caps look-through single security risk at 100 basis points
“Everything that we do has a pretty strong look through to underlying position sizing. So we are willing to take a hundred basis point look through security level risk. We certainly routinely want to carry 40 or 50 basis point look through single security risk.”
Gulati: Running risk as sole decision-maker differs fundamentally from team investing
“The one thing, Perry was a team-based approach, and I do think it's important to run risk on your own, be the sole trigger puller, the portfolio manager. It's very different than running capital within a large organization, from my perspective.”
Gulati: The ability to cut risk quickly is lacking across the industry
“Being able to cut risk and move on
Is one of those traits that's often talked about, but lacking in a lot of our industry.”
Gulati: A 90% investment win rate means you are taking improper risk
“When you're right, 90% of the time, you're probably not taking the right risk because you're very correlated or tied to the market, unless that's what you're looking to do. Our view is you need to be right a little more than 50%. I think it's in the 65 to 70% …”
Gulati: Alpha is fundamentally driven by correct conviction-based position sizing
“I'm a true believer that it's all about position sizing and getting that correct. And that's how you generate alpha.”
Gulati: Antara avoids small positions in favor of larger structured trades
“We don't want to just put a trade on to have a one, two percent position. We'd rather size it to have a more meaningful impact, but you need to structure downside protection and have that hopefully asymmetric upside as well.”
Gulati: Antara purchases call options against short positions to cap downside risk
“Since our inception example, if we have a short stock position, we buy calls against it because we don't want to be short squeezed out. If we are doing something in the options market, everything's always capped so we can make sure we understand what our downs…”
Gulati: Holding small portfolio positions causes death by a million paper cuts
“Having a lot of small 25, 51% positions is usually a way to not generate returns, and also you end up losing, I feel like it's death by a million paper cuts.”
Bergstrom: Allocators lazily use total position count as a proxy for risk
“I think there's a fair amount of laziness in the industry in using number of positions as a proxy for risk and concentration, just because it's easier when really it needs to be about sort of the sizing of those positions and the upside downside potential in t…”
Gulati: Antara typically holds around forty positions across longs and shorts
“So on the long side, we're going to have somewhere in the 30 to 35 names outside of maybe a distress cycle where it becomes a little more concentrated. And on the short side, it's about 10 names. So let's just call it 40 names total.”
Gulati: Hospitality and entertainment post-COVID margin expansions are largely permanent
“Those companies generally were able to reduce their cost structures materially during COVID and because they had to in order to survive. Will some of those costs come back? Sure. But a lot of them are gone forever. So these companies have significantly higher …”
Gulati: Reopening companies trade at enterprise values significantly above pre-COVID levels
“A lot of them are trading at a much higher enterprise value To EBITDA. Today, so a higher EV than they were pre-COVID. A lot of them are somewhere between 30 to 50% higher, which is the anticipation of stronger earnings going forward.”