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REFILE-UPDATE 1-Ex-Dresdner traders ready $40 mln Asia hedge fund
March 24, 2011 / 7:33 AM / 7 years ago

REFILE-UPDATE 1-Ex-Dresdner traders ready $40 mln Asia hedge fund

(Refiles to fix typo in headline)

* HK-based Noho Capital to launch managed futures fund

* Aims for 5 pct volatility, 10 pct annual return

* Noho received asset management licence last week

* First seed investor to commit capital in a few days (Adds details, background, quote)

By Nishant Kumar

HONG KONG, March 24 (Reuters) - Noho Capital, founded by former equity derivative traders of Germany’s Dresdner Bank, is preparing to launch a managed futures Asia-focused hedge fund aimed at gathering $40 million by the end of 2011.

Mathias Piardon and Frederic Levy, co-founders of the Hong Kong-based firm, said they received an asset management licence from the Securities and Futures Commission last week and had signed a deal to receive the first seed capital investment in the next few days.

Managed futures funds, sometimes referred to as commodity trading advisers or CTAs, bet on long-running trends in markets. They manage about $200 billion globally, according to data from industry tracker Eurekahedge.

“What we are doing is purely systematic trading,” Piardon told Reuters in an interview. “We have proprietary algorithms that we developed in the last two years.”

Noho Capital’s managed futures fund will focus on Asian equity index futures, with target volatility and drawdown of 5 percent. It aims to achieve 10 percent annual returns and has a capacity to take in about $400 million.

Piardon was head of equity derivatives trading for Asia ex-Japan at Dresdner, Hong Kong, when Levy joined from ABN Amro, Hong Kong, where he was regional head of exotic equity trading.

The French duo worked together for a short period at Dresdner before moving out to work on their own strategy.

They started trading with their own money last August and since then have achieved positive returns in five of the last seven months, with a more than 1 percent gain in three.     Some of the strategies followed by Noho, named after a trendy area of Hong Kong, includes mean reversal strategies, trend following and deterministic strategies that give signals on possible market moves.

Noho Capital joins the revival of flows into the $152 billion Asian hedge funds industry that saw 95 new launches attract $3.84 billion in 2010, an increase of 50 percent from a year earlier, data from industry tracker AsiaHedge showed.

Levy, whose previous employers include French banking giant BNP Paribas SA , said they were in the process of appointing a prime broker and would also hire a chief operating officer later in the year to help gather more assets.

The hedge fund would also expand to other asset classes in future and there were plans to start an offshore fund with a minimum investment of $100,000, Levy said, adding that they did not plan to hire a big team.     “We do not want 30 people. We like the boutique system where we can control everything,” Levy said. (Editing by chris Lewis)

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