Horton Point, a systematic trading firm based in New York, is expanding into the seeding business.
Originally built as proprietary trading firm, Horton Point later expanded to include a number of institutional managed account investors.
It is now moving into the incubation business and is raising a private equity fund to serve as a seeding vehicle for a number of systematic traders.
“We see large numbers of deeply experienced talented quantitative traders being displaced from large firms. Many are eager to set up their own shops. Their alpha-generation skills are very appealing, but they lack other ingredients necessary to build a successful hedge fund organisation,” says Horton Point chief executive Dimitri Sogoloff. “We feel we are uniquely positioned to help them in this process.”
As part of its deal with start-up managers, Horton Point plans to provide capital as well as operational, risk management, compliance, and marketing infrastructure.
“We are practitioners of systematic trading and have built a robust infrastructure to serve our own needs. It’s been battle-tested since 2007 and has significant excess capacity to take on select outside managers,” adds Sogoloff.
The managers will also have access to the services of Horton Point’s chief operating officer, chief risk officer, and a business development professional.
In preparation for the platform launch, Horton Point has identified a number of managers and begun negotiating terms. The Soundview Emerging Managers Fund I is set to launch early next year. It will focus exclusively on short-term systematic managers with limited capacity.
