NAV-Squeezing with CAZ Investments
Introducing the CAZ Strategic Opportunities Fund. Can we all be super?
“And when everyone’s super…no one will be.” -Syndrome, The Incredibles
Way back in 2024, before the Alts Democratization really got rolling, we stumbled upon a certain ‘40-Act fund called the CAZ Strategic Opportunities Fund (1).
We were attracted to CAZ, a Houston-based firm offering “Exclusive Access to Unique Alternatives” per its website, because we saw Tony Robbins (he owns a passive minority stake in CAZ) on CNBC speaking as an authority on private equity but not exactly sounding like one, seeming to conflate IRRs and TWRs (2).
Always curious, we bought Robbins’ book The Holy Grail of Investing, a modestly entitled work written in collaboration with CAZ’ CEO (used, Amazon, $9.98 before tax. Alas, our copy was not signed).
The Holy Grail of Investing lacks a traditional introduction or prologue. Instead, the reader is greeted with a “Disclosure” section which includes disclaimers like:
“This book is not intended to serve as the basis for any financial decision; as a recommendation of a specific investment advisor, or as an offer to sell or purchase any security,” and:
“The authors(s)…disclaim any responsibility for any liability, loss, or risk, personal or otherwise, which is incurred as a consequence, directly or indirectly, of the use an application of any of the contents of this book.”
Good to know.
Side note: We like Tony Robbins. Truly. Even if his CNBC charisma could not compensate for his lack of competence when it comes to private equity performance math. Anyway, he’s not alone: Barron’s are you reading this? (3)
We haven’t bought a stake in the CAZ Strategic Opportunities fund, though we did do a bit of due diligence, which we share below.
Getting involved
Our first question: if we bought this fund, where would it ‘live’? It turns out, Schwab was willing to hold the investment in the AltView brokerage account for $250 per annum. For a smallish, ‘democratization of Alts’-seeking retail investor, that’s a 1% annual fee for a $25,000 investment. This seems a lot, no?
Coincidentally, the CAZ fund has an “A” class, which permits investments as small as $25,000. The fund’s Class A shares had not commenced operations as of March 31, but based on recent SEC announcements, we suspect that may soon change. Investments in Class A shares will be subject to a sales charge of up to 3.00% (4).
Thus for the new $25k investor in the fund: $250 per year brokerage fee, and up to $750 (one-time fee) to gain access. We’re not feeling it.
NO PRIZES for guessing the performance drivers
The nascent fund has had excellent results since inception in, err, 2024, and has been growing fast, recently crossing the quarter-of-a-billion mark. Here are some results shared by a CAZ representative:
Performance Snapshot (as of 4/30/25 – Class I):
Inception-to-Date Return (since 3/1/24): +17.90%
One Year Return: +17.66%
Fund Size: $260M+
Avid Altview readers get exactly ZERO GUESSES as to the primary sources of the fund’s returns and may skip the next few paragraphs.
For our new readers: The CAZ fund owns a lot of secondary private equity funds. They comprise over 40% of the fund, in excess of the fund’s target of 30-40%. Overall, 91% of the fund is invested in private equity of some sort.
Aside: this fund has two benchmarks, both of which look like slow rabbits: The S&P Target Risk Index (a 60/40 stock/bond blend) and the “All Seasons Blended Index” which is comprised mostly of bonds, and just 30% stocks. These may come in handy in the future, just in case returns don’t measure up.
As of March 2025, of the $27 million in unrealized gains, $19 million came from secondaries. To CAZ’ great credit, the cost basis disclosures did not require unscrambling a-la Stepstone or Hamilton Lane.
Valuations rely on GP-provided NAVs for secondaries. From the Fund’s Annual Report (bold is ours):
“The fair value of such investments as of each Determination Date ordinarily will be the capital account value of the Fund’s interest in such investments as provided by the relevant general partner, managing member or affiliated investment adviser of the private investment vehicles, such as private equity funds and private credit funds, in which the Fund invests (the “Investment Funds”) (the “Investment Managers”) as of or prior to the relevant Determination Date; provided that such values will be adjusted for any other relevant information available at the time the Fund values its portfolio, including capital activity and material events occurring between the reference dates of the Investment Managers’ valuations and the relevant Determination Date.”
At the AltView we may misunderstand j-curves and n-curves, but it seems the CAZ fund, like others we’ve discussed, is
1. Showing performance that relies heavily on NAV-squeezing and
2. Reliant on future inflows to generate the same pace of NAV-Squeezed returns.
The Holy Grail of Investing conjured up an image of a surer thing, and accordingly we have elected to will pass on this particular opportunity.
Houston does not Have a Problem. At least probably not.
Also puzzling (troubling?); as of March 31, the CAZ fund had $200 million in unfunded commitments, meaning it is invested in funds which in turn can require CAZ to pony up that amount. That seems an awful lot for a fully-invested fund of this size ($260 million as of April).
The annual report notes that the CAZ fund itself already has about $500 million in committed capital, suggesting significant new inflows from new CAZ investors to help meet capital needs.
Nonetheless, committed capital is not the same as cash in the bank. CAZ could find itself out over its' skis, as the annual report notes:
“The Fund’s over-commitment strategy may increase the risk that the Fund is unable to satisfy a capital call from an Investment Fund.”
The AltView asked CAZ about the fund's unrealized gains on Secondary funds, capital commitments, and the funds' slow-rabbit benchmarks. We did not receive a response to our questions.
Can we all be super?
Aside from the clear structural problems of Secondary-Focused Evergreen Funds(5), we see a striking juxtaposition between CAZ’ website language: “Exclusive Access to Unique Alternatives” and the reality of the CAZ Strategic Opportunities Fund, now (or shortly) open to investors with as little as $25,000.
To us, the fact that funds like CAZ will soon be open to nearly all investors suggests that maybe the opportunities aren’t so super after all.
The deeper irony: in many cases, they never were.
Resources:
1.
https://cazstrategicopportunitiesfund.com/
2. https://www.cnbc.com/video/2024/02/12/global-entrepreneur-tony-robbins-talks-investing-in-private-equity.html. IRR=internal rate of return; TWR=Time-weighted rate of return. See also footnote #3.
5. The AltView is not alone in this view:
NOT INVESTMENT ADVICE. INVEST (OR DON'T) AT YOUR OWN RISK
