The shockwaves from Archegos Capital Management’s dramatic implosion back in March continue to reverberate around the asset management industry, with Credit Suisse announcing this week that it will shut down most of its prime brokerage business.
Though Bill Hwang’s doomed single family office was not a hedge fund, its collapse – triggered after it defaulted on a series of margin calls by investment banks – signaled far-reaching implications for this industry. The episode brought hefty losses to a number of major lenders, and Credit Suisse’s decision this week is sure to throw the spotlight back onto how PB leverage, risk management, portfolio transparency, margin limits and more are handled across the hedge fund and prime brokerage sphere.
With the COP26 climate summit taking place in Glasgow this week, the renewed focus on sustainability and the global environmental challenge offers an assortment of trading opportunities on the horizon for hedge funds.
The sector may have endured a bumpy third quarter, but Man FRM’s chief investment officer Jens Foehrenbach believes certain fund strategies, particularly in the long/short equity space, can capitalise on the divide between the “winners” and “losers” in the move towards carbon neutrality and exit from fossil fuels.
Meanwhile, Sir Paul Marshall, co-founder, chairman and chief investment officer of UK hedge fund giant Marshall Wace, has pledged GBP50 million to the London School of Economics’ Marshall Institute to establish a new accelerator programme aimed at tackling future environmental, health, and social inequality challenges.
Unveiled on finance day at COP26, and set for launch in spring next year, the Marshall Impact Accelerator offers philanthropic capital for innovative social ventures spanning environment, health, social inequality, public policy and developmental economics challenges.
Lazard Asset Management has launched a new long/short credit UCITS hedge fund which trades investment grade, crossover, and high-yield bonds in Europe and North America.
Managed by Sal Naro, Vincent Mistretta, Michael Cannon and Sanjay Aiyar, the Lazard Coherence Credit Alternative Fund’s trading strategy sees fixed income markets as an extension of equities, and will bet on yield spread and price changes influenced by earnings and credit ratings moves.
Elsewhere, Corinthian Digital Asset Management, a diversified digital assets offshoot of London-based crypto arbitrage hedge fund Argentium, has named ex-Macquarie and JP Morgan equity research head Peter Redhead as partner and chief operating officer.
The announcement comes as UAE-headquartered Corinthian, which was established by Argentium founder Paul Frost-Smith, prepares to open its debut hedge fund strategy Chiron to external capital in February next year. Chiron runs a core portfolio of crypto outperformance strategies, coupled with an opportunistic trading approach to relative value opportunities in the crypto markets.
Brummer & Partners’ flagship multi-strategy hedge fund vehicle ended last month marginally in the black, as positive gains made by its systematic trend-following managers were set against sharp losses in its fixed income relative value exposures.