Schonfeld commits $100 million to tech hedge fund launch

NEW YORK (Reuters) - Trading magnate Steven Schonfeld is backing a new hedge fund firm with at least $100 million, according to two people familiar with the situation.

Schonfeld Strategic Advisors, which mostly manages Schonfeld’s personal fortune, is set to partner with Lucha Capital Management, a nascent San Francisco-based investment shop led by Marcelo Desio.

Lucha plans to launch in July or August and will take invest primarily in the stocks of U.S. technology, media, telecommunication and business service companies, according to one of the sources. Schonfeld’s funding commitment is for at least three years and its investment could grow depending on performance, said the sources, who requested anonymity because the information is private.

The fund will buy some stocks while taking short positions in others, a strategy that yields profits if the stock price falls.

Schonfeld managed $4.02 billion as of Jan. 1, according to its most recent public filing with the U.S. Securities and Exchange Commission. The firm recently allowed employees and some outsiders to invest alongside the founder.

Schonfeld uses about 40 small investment teams, a so-called multi-manager strategy. Some are based in Schonfeld’s New York-area offices or externally, like Lucha. The teams invest using three main styles: “quantitative” computer algorithms, traditional human stock-picking, and shorter-term trading. Schonfeld has hired at least five portfolio managers this year, according to one of the people.

Desio, Lucha’s portfolio manager, will be joined by co-founder and senior analyst Bill Dauphinais. Both most recently worked at another hedge fund firm, Crosslink Capital.

Reporting by Lawrence Delevingne; Editing by David Gregorio