Nicolas Monaghan, the trader embroiled in a legal dispute between Schonfeld Strategic Advisors and his former employer, Garda Capital Partners, is gearing up to launch his own hedge fund, Mistral Capital, with an initial $1bn allocation from Schonfeld, according to a report by Bloomberg.
The report cites unnamed sources familiar with the matter as revealing that Monaghan, who is known for his expertise in bond basis trades, will run the fund exclusively for Schonfeld before opening it to outside investors, with the Monaco-based hedge fund expected to begin trading by mid-2025.
Garda Capital Partners filed a lawsuit last month accusing Schonfeld of orchestrating Monaghan’s departure in violation of his non-compete agreement. Garda alleged that Monaghan, one of its most profitable portfolio managers, generated over $250m in profits during his tenure since 2019. Garda also claimed that Schonfeld “induced” Monaghan to leave improperly and is seeking to enforce the terms of his non-compete agreement, which expires in March 2026.
Monaghan and Schonfeld representatives declined to comment, while Garda has yet to provide further statements. Schonfeld has until 29 January to formally respond to the suit.
Schonfeld, which manages $12bn in external client capital, has been expanding aggressively into macro and fixed-income trading under the leadership of Colin Lancaster and Mitesh Parikh, who joined in 2021. Mistral Capital will be the first external fund to receive an allocation from the firm’s Discretionary Macro & Fixed Income unit, which comprises 38 portfolio managers across 20 trading teams.
Mistral Capital will focus on a global fixed-income relative value strategy, with Monaghan assembling a team of former colleagues, including William Vozzolo and Thibault Cons, to support operations.
