General Description, Types of Advisory Services and Areas of Specialization: QMS Capital Management LP (“QMS,” “we” or “us”) was formed in 2008 as a financial advisor to institutions and high net worth individuals. The core group of founding employees was in place as of January 2010, and we began live trading in a long-short global futures account for a strategic investor in mid-May 2010. This investor, a proprietary trading operation of a large financial institution, redeemed in March 2011. We resumed trading in May 2011. We apply sophisticated quantitative methods to investing in financial markets. Our approach blends academic research, extensive asset management experience, and state of the art technology to serve our clients. For additional information regarding our quantitative investment process, please see Item 8 below.

Prior to January 2, 2018, we specialized in and managed only portfolios consisting of exchange-traded futures, currency forwards and short-term treasury bills (“Global Macro Strategies”). On January 2, 2018, we launched an equity market neutral strategy (the “EMN Strategy.”) The only account we currently manage using this strategy is QMS Equity Market Neutral Master Ltd. (the “EMN Fund”). In addition, currently the only investors in the EMN Fund are the six principals of QMS and the General Partner of the QMS Equity Market Neutral U.S. Fund LP. In this Form ADV Part 2A, we describe only our EMN Strategy and the EMN Fund, which is an investment advisory client. We do not describe our Global Macro Strategies except to the extent required.

Principal Owners: QMS is 100% owned by principals of the firm, including Michael Brandt and Adil Nathani, each of whom owns, directly or indirectly, 32.66% of QMS (Mr. Nathani’s ownership of QMS is held indirectly through ARMI Capital LP). Tailored Services: Because the EMN Fund is the only account managed using the EMN Strategy, clients may not place limits on the types of investments made by the EMN Fund. Wrap Programs: We do not participate in wrap fee programs. Assets under Management: At January 31, 2019, there were no client assets invested in the EMN Fund or EMN Strategy. At January 31, 2019, the EMN Fund had $31,707,643 million in assets, which were solely proprietary assets. We do not provide non-discretionary advice. please register to get more info

Compensation for Advisory Services: The EMN Fund will pay us a management fee, based on the net asset value of each investor’s interest in the EMN Fund, and a performance-based allocation. The EMN Fund is available for investment only to qualified purchasers. The terms of the EMN Fund are set forth in the relevant EMN Fund documents. We may enter into side letters with investors that provide, among other things, a reduction or rebate of fees or performance-based allocations.

Method of Payment: We will direct the fund administrator of the EMN Fund to pay management fees and performance-based allocations to us. Management fees are paid monthly in arrears, and performance- based allocations are made annually.

Other Fees and Expenses: The EMN Fund has its own expenses, such as external legal, compliance, audit, accounting, tax preparation expenses (including third party accounting and tax preparation services), administrator fees and expenses, organizational expenses, custodial fees, bank service fees, corporate filing fees and expenses, ongoing regulatory expenses, including, without limitation, the fees and expenses associated with the preparation and filings related to Form PF and other regulatory filings which seek information about the EMN Fund, registered-office expenses, fees and expenses of service providers retained to comply with laws and rules related to the offering of interests of the EMN Fund, EMN Fund- related insurance costs (including D&O insurance costs), Directors' fees and expenses, interest on borrowing, investment expenses such as commissions, interest on margin accounts, and borrowing charges on securities sold short. These expenses are described in the EMN Fund’s offering document.

Pre-Payment of Fees: We do not require our clients to pay any fees in advance for our services.

No Compensation for Sale of Securities: Neither we nor any of our supervised persons accept compensation for the sale of securities or other investment products, such as asset-based sales charges or service fees from the sale of mutual funds. please register to get more info

Performance-Based Fees: The EMN Fund is subject to a performance-based allocation.

Potential Conflicts of Interest Arising from Side-by-Side Management: We do not currently manage any EMN Strategy accounts other than the EMN Fund. However, performance-based compensation creates a conflict of interest in that it incentivizes risk taking investing. please register to get more info

Our only investment advisory (as opposed to commodities) client is the EMN Fund. Only qualified purchasers are eligible to invest in the EMN Fund. EMN Fund investors may include funds of funds, family offices, endowments, foundations, sovereign wealth funds, public pensions, and high net worth individuals. The minimum initial subscription to the EMN Fund is $2,000,000. please register to get more info

Description of the Methods of Analysis and Investment Strategies We Use in Formulating Investment
Advice or Managing Assets: We use a quantitative framework to manage our portfolio. The goal of our research platform is to provide an efficient and objective evaluation environment for alpha development, while minimizing statistical and behavioral biases.

When we determine the portfolio of securities to hold, we subscribe to a risk budgeting approach to portfolio construction. We allocate risk to factors (or, definable sources of return). At the portfolio level, a single, long-short portfolio of equity exposures expresses the combined views of all factors.

Certain Material Risks Regarding Investment Strategies:

Investing in any security or investment strategy involves the risk of loss and each client should be
prepared to bear that loss. There can be no assurance that the investment objective of a separate
account or fund that we manage will be achieved or that our strategies will be successful. Investors
must be prepared to lose all or substantially all of their investment.

Market Risks The profitability of a significant portion of the EMN Strategy depends to a great extent upon correctly assessing the future course of the price movements of securities and other investments. There can be no assurance that we will be able to predict accurately these price movements. With respect to the EMN Strategy, there is always some, and occasionally a significant, degree of market risk.

Nature of Investments Investments will generally consist of positions in equity market instruments and other assets that may be affected by business, financial market or legal uncertainties. There can be no assurance that we will correctly evaluate the nature and magnitude of the various factors that could affect the value of and return on investments. Prices of investments may be volatile, and a variety of factors that are inherently difficult to predict, such as domestic or international economic and political developments, may significantly affect the results of the EMN Strategy and the value of its investments. In addition, the value of the EMN Strategy’s portfolio may fluctuate as the general level of interest rates fluctuates.

Market Neutral Strategy Risk We intend for the EMN Strategy to generally be market neutral, although at times it may have net long or net short exposure. Our use of short sales and other hedging transactions in combination with long positions in an attempt to maintain a market neutral portfolio may not be successful and may result in greater losses or lower positive returns than if the EMN Strategy held only long or short positions. When the general stock market is performing strongly, the EMN Strategy is expected to underperform the market because the strategy’s short positions will likely lose money. If the EMN Strategy has net long or net short exposure, the strategy will be subject to the risk that stock prices overall will decline or increase, respectively. Stock markets tend to move in cycles, with periods of rising prices and periods of falling prices.

Equity Securities and Equity-Related Instruments The EMN Strategy will invest in publicly traded common stocks and other equity market instruments, including but not limited to publicly listed equity securities, privately offered equity securities or financial instruments that may reference a single issuer, a specific sector or a broad equity index. Equity securities represent ownership interests in their respective issuers and generally carry the most risk associated with a specific issuer’s capital structure.

The price of equity securities and their related financial instruments vary for a variety of reasons, including but not limited to supply and demand of the equity securities, the actual or perceived business opportunities associated with the issuer, the current and potential future cash flow of the issuer, the issuer’s management, their ability to execute on a specific business plan, the general economic environment and the outlook for the overall economy. We may hold or trade in securities at the time of significant corporate events, such as earnings releases, which may lead to increased volatility. To the extent the EMN Strategy owns an equity security or otherwise has exposure to an equity-related financial instrument, such investment carries the risks associated with owning equities and may also carry risks associated with the form of financial instrument (e.g., options, derivative or securities-based futures contract). Any investment in equities or equity-related instruments entails a significant risk of loss. Futures Contracts The EMN Strategy may invest in futures. If we invest in an index future at an inappropriate time or judge market conditions or trends incorrectly, such investment will lower the strategy’s return or cause substantial losses. The strategy could also experience losses if it could not close out its positions because of an illiquid market, which could require the strategy to maintain a position until exercise or expiration. In addition, the strategy will incur transaction costs, including trading commissions, in connection with its futures transactions and these transaction costs could decrease the strategy’s investment return. Futures markets are highly volatile. The low margin or premiums normally required in such trading may provide a large amount of leverage, and a relatively small change in the value of the asset underlying a future can produce a disproportionately larger profit or loss. Investing in futures contracts, options or commodities is a highly specialized investment activity entailing greater than ordinary investment risk.

Short Sales Short sales can, in certain circumstances, substantially increase the impact of adverse price movements on the EMN Strategy. A short sale involves the risk of a theoretically unlimited increase in the market price of the particular investment sold short, which could result in an inability to cover the short position and a theoretically unlimited loss. There is a risk that an EMN Strategy account would have to return the securities it borrows, in connection with a short sale, to the securities lender on short notice. If a request for return of borrowed securities occurs at a time when other short sellers of the security are receiving similar requests, a “short squeeze” can occur, and the EMN Strategy account may be compelled to replace borrowed securities previously sold short with purchases on the open market at the most disadvantageous time, possibly at prices significantly in excess of the proceeds received in originally selling the securities short.

Model Risk We utilize various proprietary quantitative models to identify investment opportunities. There is a possibility that one or all of the quantitative models may fail to identify profitable opportunities at any time. Furthermore, they may incorrectly identify opportunities and these mis-identified opportunities may lead to substantial losses

Technology and Licensing Risk Our investment strategy relies heavily on the use of proprietary and non-proprietary software, data and intellectual property being licensed to it on a non-exclusive basis by commercial software analytics, research and data supply entities. To the extent that an unforeseeable software or hardware malfunction or problem is caused by a defect, virus or other outside force, the EMN Strategy may be adversely affected. In addition, if the licensed material is found to be owned by a third party, and not by the licensing company, as represented, the EMN Strategy could be adversely affected.

Cybersecurity Risk We may be prone to operational, information security and related risks resulting from failures of or breaches in cybersecurity.

A failure of or breach in cybersecurity (“cyber incidents”) refers to both intentional and unintentional events that may cause the relevant party to lose proprietary information, suffer data corruption, or lose operational capacity. In general, cyber incidents can result from deliberate attacks (“cyber-attacks”) or unintentional events. Cyber-attacks include, but are not limited to, gaining unauthorized access to digital systems (e.g., through “hacking” or malicious software coding) for purposes of misappropriating assets or sensitive information, corrupting data, causing operational disruption, or attempting to improperly influence or control trading or order placement. Cyber-attacks may also be carried out in a manner that does not require gaining unauthorized access, such as causing denial-of-service attacks on websites (i.e., efforts to make network services unavailable to intended users). The issuers of securities and/or counterparties to other financial instruments in which the EMN Strategy may invest may also be prone to cyber incidents. Cyber incidents may cause disruption and impact business operations, potentially resulting in financial losses, impediments to trading, violations of applicable privacy and other laws, regulatory fines, penalties, reputational damage, reimbursement or other compensation costs, or additional compliance costs. While we have established business continuity plans in the event of, and risk management strategies, systems, policies and procedures to seek to prevent, cyber incidents, there are inherent limitations in such plans, strategies, systems, policies and procedures including the possibility that certain risks have not been identified.

Risk Control Framework No risk control system is fail-safe, and no assurance can be given that any risk control framework we employ will achieve its objective. Target risk limits we have developed may be based upon historical trading patterns for the financial instruments in which the EMN Strategy invests. No assurance can be given that such historical trading patterns will accurately predict future trading patterns.

Portfolio Turnover The EMN Strategy will involve the taking of frequent trading positions, and, as a result, turnover and brokerage commission expenses of the Fund may significantly exceed those of other investment entities of comparable size and may have a substantial negative impact on net returns.

Margin Borrowing Margin borrowing increases returns to investors if the EMN Strategy earns a greater return on leveraged investments than strategy’s cost of such leverage. However, the use of margin borrowing exposes an EMN Strategy account to additional levels of risk including (i) greater losses from investments than would otherwise have been the case had the account not borrowed to make the investments, (ii) margin calls or changes in margin requirements may force premature liquidations of investment positions, and (iii) losses on investments where the investment fails to earn a return that equals or exceeds the account’s cost of leverage related to such investments. In case of a sudden, precipitous drop in value of the EMN Strategy’s assets, we might not be able to liquidate assets quickly enough to repay its borrowings, further magnifying the losses incurred.

The above is not a complete list of risk factors relating to investing in the EMN Strategy. See the offering materials for the EMN Fund for a more complete description. please register to get more info

There are no legal or disciplinary events that are material to a client’s or prospective client’s evaluation of our advisory business or the integrity of our management. please register to get more info

Broker-Dealer or Registered Representative of a Broker-Dealer: Neither we nor any of our management persons are registered, or have an application pending to register, as a broker-dealer or a registered representative of a broker-dealer.

Commodity Pool Operator and Commodity Trading Advisor: QMS is registered with the Commodity Futures Trading Commission as a commodity pool operator and a commodity trading advisor, and is a member of the National Futures Association. QMS currently manages accounts using Global Macro Strategies. In addition, the following employees of QMS are registered with the NFA:
Name Title Registration NFA ID Number
Michael Brandt Managing Principal Associated Person, Principal and Swap Adil Nathani Managing Principal Associated Person, Principal and Swap Peter Nolan Managing Principal Associated Person, Principal and Swap Adrian Enverga Managing Director Associated Person and Swap 0458603 Sarah Thayer Vice President Associated Person and Swap Associated Person of QMS 0501779 Grace Lynch Analyst Associated Person and Swap Associated Person of QMS 0518278 Daryl Caldwell Principal Principal of QMS 0436190 Richard O’Brien Principal Principal of QMS 0436165 William Schwartz Principal, General Counsel, CCO & COO Principal of QMS 0369611

Manager of Managers: We do not recommend or select other investment advisers for our clients.

Material Relationships: QMS Capital Onshore GP LP (the “General Partner”), an affiliate of QMS, serves as the general partner of QMS Equity Market Neutral U.S. Fund LP, the United States domiciled EMN feeder fund. While the General Partner is not separately registered as an investment adviser with the SEC, all of its investment advisory activities are subject to the Investment Advisers Act of 1940, as amended (the “Advisers Act”) and the rules thereunder. The General Partner has the same ownership and personnel as QMS. The principals of QMS and the General Partner have an investment in the EMN Fund. please register to get more info

Personal Trading
Code of Ethics: While we do not expect to have material non-public information regarding issuers, we seek to limit any potential to take advantage of such information through maintenance of a restricted list, which is a list of instruments in which our employees may not invest for their personal accounts. This list consists of (1) equity index futures, commodity futures, and fixed income/interest rate futures we invest in for Global Macro Strategies portfolios, (2) U.S. equity securities (equity securities traded on U.S. stock exchanges and equity securities of U.S. issuers traded on non-U.S. stock exchanges), and derivatives on U.S. equity securities, (3) equity securities issued by our publicly-traded clients, (4) mutual funds for which we serve as investment adviser or sub-adviser, and (5) if necessary, any issuers about which we have material, non-public information.

Certain investments by employees must be pre-cleared by our Chief Compliance Officer. These are (1) an investment in an exchange-traded fund (“ETF”) in an amount greater than $250,000 in one day, (2) securities issued in a limited offering, such as a private placement, (3) securities issued in an initial public offering, and (4) certain cryptocurrencies. ETF transactions that are required to be pre-cleared are also subject to a holding period requirement – employees may not buy or sell such an ETF within 60 days of the sale or purchase of that ETF.

Each employee who has a personal account provides account statements to our Chief Compliance Officer on a quarterly basis (either sent directly by the applicable brokerage firm or sent by the employee). Employees are required to certify in writing annually that they have complied with the Code of Ethics. Our Chief Compliance Officer monitors each employee’s personal account statements for compliance with the Code of Ethics. Other Provisions of the Code of Ethics: Our Compliance Manual contains a policy statement regarding insider trading. The policy statement is as follows: QMS forbids any employee from trading, either personally or on behalf of others, including the Advisory Clients, on material non-public information or communicating material non-public information to others in violation of the law. This conduct is frequently referred to as “insider trading.” QMS’s policy applies to every employee and extends to activities within and outside their duties at QMS’s principal office. A copy of our Compliance Manual, including the Code of Ethics, is available upon request. To obtain a copy, please contact our Chief Compliance Officer at 919-493-3211.
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General: QMS has discretion to select executing brokers or dealers. In selecting brokers or dealers to execute transactions, we attempt to ensure that the total cost or proceeds of any transaction for a client is the most favorable obtainable under the circumstances. We review brokers under an overall best execution analysis. For instance, in addition to evaluating the reasonableness of commissions charged, we attempt to trade with brokers who are able to provide high quality execution, including handling our algorithmic execution process and providing access to securities to borrow for short sales.

Ultimate responsibility for approving a counterparty and establishing the maximum threshold of exposure to any given counterparty rests with our Chief Risk Officer.

Soft Dollars: We do not participate in any formal soft-dollar arrangements. We receive research, seminar invitations, and similar services from brokers by virtue of generally trading in the market. In addition, we may use certain services offered by brokers, such as access to execution applications, on behalf of our clients. Our access to this research and these services is not contingent upon committing any amount of business to these brokers, nor do we “pay up” for this research. We may have an incentive to continue trading with these brokers in order to continue to receive this research or these services.

Brokerage for Client Referrals: In selecting brokers, we do not consider whether we receive client referrals from the broker. Brokers do, however, refer clients to us, through programs such as broker capital introduction services.

Directed Brokerage: All trades for the EMN Fund will be executed EMN Fund’s prime broker or other executing brokers in QMS’s discretion. Clients may not direct us to use any particular broker.

Aggregation of Orders: We currently only manage one account using the EMN Strategy, which is the EMN Fund. Thus, no orders in the EMN Strategy need to be aggregated.

Trade Errors: When a trade error is clearly caused by a counterparty, such as a broker-dealer, QMS will strive to recover from the counterparty any losses associated with such error. There is no guarantee that QMS will be able to do so. When a trade error is caused by an employee of QMS, the firm will seek to resolve the error on a fair and equitable basis. Generally, when a trade error is caused by an employee, any losses associated therewith will be charged to QMS. Each situation requires a tailored response and accordingly will be dealt with on a case-by-case basis and consistent with QMS’s fiduciary duty with respect to its advisory clients. To the extent that any gains arise from a trade error then such gains will be retained by the advisory client that benefited from such error. please register to get more info

Periodic Reviews and Review Triggers: Principals of the firm will review the EMN Fund’s returns, risk exposures, and performance attribution regularly, on at least a weekly basis but typically more frequently. Clients may request regular phone calls or meetings to review EMN Fund performance. Regular Reports: The administrator for the EMN Fund will provide monthly written reports to investors that report the EMN Fund performance. In addition, we will provide written commentary on the performance drivers for the month. please register to get more info

We do not receive any economic benefit from any third parties in return for providing investment advice or other services.

Neither we nor a related person directly or indirectly compensates any person who is not one of our supervised persons for client referrals. please register to get more info

QMS and the General Partner are deemed to have custody of the assets of the EMN Fund. We will ensure that the EMN Fund’s financial statements are audited by an independent public accountant registered with, and subject to regular inspection by, the Public Company Accounting Oversight Board. The audited financials will be prepared in accordance with generally accepted accounting principles in the U.S. and be distributed to all investors within 120 days following the EMN Fund’s fiscal year end.

Investment advisers are required to maintain the funds and securities over which they have custody with a “qualified custodian.” Qualified custodians include banks, broker- dealers, futures commission merchants and certain foreign financial institutions. The funds and securities of the EMN Fund will be maintained with a qualified custodian. please register to get more info

Authority for Trading in Discretionary Accounts: We accept discretionary authority to manage the EMN Fund. This authority includes the authority to determine, without obtaining client permission or pre- approval, the instruments to be bought or sold, the amount of such instruments to be bought or sold, generally the broker to be used, and the commission rates paid, if applicable. Investors in the EMN Fund may not place limitations on our discretionary authority over the EMN Fund.

Procedure for Establishing Investment Discretion: The investment management agreement between us and the EMN Fund establishes the authority we may exercise over the EMN Fund.
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Our current policy is that we do not vote proxies. We believe that any issues related to proxy voting of portfolio issues are irrelevant to the EMN Strategy. Clients may not direct us to vote in a particular proxy solicitation. Clients may obtain a copy of our proxy voting policies upon request. please register to get more info

Prepayments: We do not require or solicit prepayment of fees by clients. Discretionary Authority or Custody of Client Funds: We have discretionary authority over our client accounts and are deemed to have custody of the assets of the EMN Fund. We are not aware of any financial condition that is reasonably likely to impair our ability to meet our contractual commitment to clients. Bankruptcy: We have not been the subject of a bankruptcy petition at any time during the past 10 years. please register to get more info