Quantitative firm Two Sigma Investments has rolled out a new hedge fund, the Two Sigma Beacon Fund, designed to tap into rising investor appetite for tax-efficient strategies, according to a report by Bloomberg citing people familiar with the matter.
Debuted earlier this year, Beacon is reportedly a tax-aware long-short vehicle that seeks to minimise tax liabilities by extending holding periods on winning positions and harvesting losses where possible.
Regulatory filings show Two Sigma, which manages more than $70bn, raised $54m for Beacon as of August.
The move puts Two Sigma in direct competition with fellow quant manager AQR Capital Management, which has gathered strong inflows into its own tax-aware offering. The firm attracted roughly $32bn into its long-short tax-aware private funds and SMAs over the first nine months of the year, lifting assets in the strategy to $45.3bn, about a quarter of the firm’s total AUM.
