The long and the of it www.hfmweek.com ISSUE 356 9 October 2014

PROTEST IMPACT UNSETTLES HONG KONG FUNDS HFMWEEK MEETS Professionals have “wait and see” attitude, says one COO NEWS 03 THE SEC MOORE CAPITAL HIRES SAC’S FORMER COUNSEL AN EXCLUSIVE INTERVIEW WITH Famida Daniels joins ex-colleagues recruited earlier this year NEWS 05 TOP SEC EXAMINERS ON THE MAIN REGULATORY ISSUES FOR 13-YEAR VET LEADS LONDON LAUNCH MANAGERS Steven Cress wins Trium Capital’s biggest seed ticket so far NEWS 10 FEATURE 19 Ex-Hutchin Hill manager launches WHERE BANKS Decca Capital FEAR TO TREAD BlackRock executive who rose Shahraab Ahmad building to prominence defending the new London-based firm with UK’s hedge fund sector fol- former BlackRock COO lowing the financial crisis in an BY WILL WAINEWRIGHT appearance before the Treasury Select Committee. A FORMER PORTFOLIO The pair met through an inves- manager at Hutchin Hill is tor who was allocated to both starting a new hedge fund in Hutchin Hill and BlackRock. London named Decca Capital Prior to spells there as head of and has hired seasoned opera- alternatives, fundamental equi- tions specialist Doug Shaw as ty COO and head of charities, COO. Shaw worked for Chris Hohn’s HFMWeek has learned that TCI and Gartmore Investment Shahraab Ahmad, who spent Management. five years managing a liquid Decca’s senior team is com- credit strategy for the $2.5bn pleted by Razvan Frumosu, HFMWeek investigates how managers firm, plans to start trading with who will lead business devel- his new firm near the start of opment. He has previously are filling a hole left by the bank next year. worked in various roles for pull-back from traditional lending Ahmad, who left Hutchin Société Générale, JP Morgan Hill in June 2013, is work- and Bank of America. FEATURE 16 ing with Shaw, an eight-year Ahmad has relocated 03

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HONG KONG delayed to his knowledge. “There are some drivers that CONTINUED Protest impact unsettles make Singapore more popular FROM PAGE 1 than Hong Kong, such as the life- Hong Kong hedge funds style there and the environment, from New York to London to but I don’t think this movement build Decca and the firm is talk- Professionals have “wait and see” attitude, says one COO will change things. I don’t see an ing to potential investors and Arab Spring-type situation occur- providers ahead of its launch. HEDGE FUND WORKERS IN COO said the unrest, which saw ring – it will only be short-term,” He cut his teeth as a mon- Hong Kong have expressed unease protestors blockade squares and said Alper Ince, a managing direc- ey manager working for JP but don’t expect recent protests main roads in the city centre, was tor at Paamco. Morgan’s credit team before and unrest in the region to have unlikely to damage its status as The protests were sparked by working for Sailfish Capital a seriously adverse impact on its China’s main financial hub. China’s insistence on vetting can- Partners. He joined Hutchin status as a financial hub. “Shanghai and Beijing are not didates before they were cleared Hill, which was founded by for- “We have a wait and see atti- in the right state yet. They do not to stand in Hong Kong elections mer SAC Capital Advisors man- tude,” said Elaine Davis, COO at have the transparency that Hong in 2017. However, the number ager Neil Chriss in 2007. Nine Masts Capital, in reference Kong has,” said the person, speak- of protestors dropped over the Details on could to recent pro-democracy protests ing on condition of anonymity. weekend. not be obtained. which have divided opinion among “But I think the beneficiary from [email protected] [email protected] sources canvassed by HFMWeek. any trouble will be Singapore.” [email protected] “On the first day of the demon- Singapore is Hong Kong’s main stration we took the precaution of rival for pre-eminence as Asia’s DECURA AND UBS BATTLE IN COURT preparing our business continuity main financial hub and sources plan in [case] the protest escalated said increased turbulence in Hong DECURA GROUP AND UBS faced off in The latest stage in the contest to a level that prevented staff from Kong could see more financial court last week in the latest stage of centred on what evidence would be getting to the office safely,” said workers move to the city-state. their legal tussle over a business deal permissible in court, after UBS filed an Raymond Kwok, COO at Sparx However, a prime broker in the the two parties agreed in 2012. application that certain documents be UBS stands accused by Decura, regarded as irrelevant and not form Asia Investment Advisors, adding region told HFMWeek he was not which has brought the action, of part of the trial, which is expected to that there hasn’t been any disrup- aware of hedge fund managers reneging on its agreement to provide start later this year or early in 2015. tion to their normal working day planning to relocate because of clients for its managed account and The firms declined to comment. since the protest started. the unrest, nor had any planned businesses. [email protected] Another Hong Kong-based launches or investments been

IN THIS nlike the US, European tax relief from stamp duty. launch activity has been One obvious line of defence is the ISSUE pretty static this year with role hedge funds have taken on in Uuncertainty around the lending to businesses that the tradi- FUND MANAGER INDEX introduction of the AIFMD casting a tional banks can no longer service shadow across the region. due to new regulatory constraints. Atticus Capital 5 Balyasny Asset Management 6 But with the directive now in- In this issue we take a closer look Bell Rock Capital Management 6 force, a decent number of managers at some of the opportunities hedge BlackRock 1 EDITOR’S we’ve spoken to have been readying funds are eyeing as banks move away Bremner Capital 5 launches for the start of next year to from anything but “cookie cutter” Broadmeadow Capital 9 VIEW Caxton Associates 6 ensure they will have full-year trad- lending (p.16-17). BY PAUL McMILLAN Columbia Mgmt Investment Advisors 7 ing histories. Asset-backed finance, P2P lend- Cress Capital Management 10 We report this week on one such ing, bridging loans and niche areas Decca Capital 1 [email protected] launch, Decca Capital, which will see such as invoice factoring were all EIM 5 @mcmillan_paul former Hutchin Hill portfolio man- highlighted as popular options in Gartmore 1 p.5 Good Harbor Financial 9 ager Shahraab Ahmad move from this week’s reader survey ( ). Gottex 8 New York to London to lead the firm HFMWeek was also at the SEC’s Graham Capital 8, 10 and ex-Blackrock executive Doug offices in Washington last week to Hitchwood Capital 8 Shaw take on the COO role (p.1). interview senior staff at the Office Hutchin Hill 1,3 Investcorp 7 Shaw will be well known to of Compliance Inspections and Kings Peak Asset Management 11 many readers for his strong defence Examinations about their current Lodestar Capital Group 5 of the hedge fund sector at a UK outlook for the sector (p.19). Meditor Capital 6 Parliamentary hearing following the Although the pair were tight- Metacapital Management 11 2008 financial crisis. lipped around current investigations Moore Capital Management 5, 6 Nine Masts Capital 3 It is a role he may need to reprise into cyber security and liquid alter- Pershing Square Capital Management 11 if the Labour Party gains power at natives (for now), they offered some QSI 10 next year’s general election given its useful guidance on the type of things Rasini Fairway Capital 6 stated objective of hammering the the regulator is looking out for as Sparx Asia Investment Advisors 3 hedge fund sector through new poli- well as its top supervisory priori- Stenham Asset Management 8 Signet 8 cies such as scrapping intermediary ties. Q TCI 1 Winton Capital Management 8 York Capital Management 6

9-15 OCT 2014 HFMWEEK.COM 3 INDEX PERFORMANCE 8 Sep - 6 Oct 2014 (%) YTD RETURNS SOURCE: HSBC ALTERNATIVE INVESTMENT GROUP FTSE 100 NASDAQ S&P500 HFR INDEX HEDGE FUNDS 1.5 LOWS Pharo Gaia Merchant Commodity 1.0 & Fund Fund 0.5 0.0 HIGH 32.17% 32.14% HIGHS

BENCHMARKS -0.5

-1.0 CC Asia Absolute Mellon Offshore -1.5 Return Fund Access Fund

-2.0 08/09 10/09 12/09 16/09 18/09 22/09 24/09 26/09 30/09 02/10 06/10

MARKET MONITOR LOW -21.25% -15.81%

PAGE SOUTH AFRICA HEDGE FUNDS South Africa-based hedge funds managed assets of more than R53.6bn ($4.8bn) as of 30 June, a 27% increase on the R42.2bn ($3.7bn) managed the previous year, according to research from Novare Investments. The firm attributes the rise to a combination of strong positive performance, especially in the equity space, and inflows into the sector. Net inflows for the 12 months ending June 2014 were R4bn ($354m) of which R654m ($57.9m) was allocated to new launches. Total outflows amounted to R5.1bn ($451m) with a further R1.1bn ($97m) of capital returned to investors by funds that closed down. Over half of assets, 57%, were managed by firms with hedge fund assets exceeding R2bn ($177.1m), accounting INSIGHT for 56.9% of the entire industry but down from 68% the previous year as firms with assets between R1bn ($88.5m) and R2bn ($177.1m) increased their share from 13% to 29%. R 60,000

R53,635

R 50,000

R 42,204 R 40,000

R 33,595 R 32,096 R 30,274 R 31,433 R 30,000 R 29,434 R 25,895

R 20,000 R 15,361

R 10,000 R 6,068 R 3,286 R 1,138 R 2,125 R 0 Jun 2002 Jun 2003 Jun 2004 Jun 2005 Jun 2006 Jun 2007 Jun 2008 Jun 2009 Jun 2010 Jun 2011 Jun 2012 Jun 2013 Jun 2014

TEN LARGEST HEDGE FUNDS HEDGE FUND ASSETS BY FIRM SIZE 80% R 60,000 Jun'12 Jun'13 Jun'14 10 largest funds’ assets Total assets 70% R 50,000 60%

R 40,000 50%

40% R 30,000 30% R 20,000 20%

R 10,000 10%

0% R 0 ‹R100mR100 R200 R500 R1bn >R2bn Jun'08 Jun'09 Jun'10 Jun'11 Jun'12 Jun'13 Jun'14 -R200m -R500m - R1bn -R2bn Firm size

4 HFMWEEK.COM 9-15 OCT 2014 SEPTEMBER 2014 MERGER RELATIVE EMERGING HFRX HEDGE FUNDS VALUE MARKETS* HEDGE FUND INDEX 0.76% -0.05% 1.16%

INDICES (YTD 3 OCTOBER 2014) 1.19% EQUITY EQUITY EQUITY LONG/SHORT SHORT BIAS* MKT NTRL FUNDS OF 1.23% -3.60% 2.64% HEDGE FUNDS* HFRI composite GLOBAL EVENT MULTI MACRO DRIVEN STRATEGY* 2.62% 2.55% 1.47% 2.40%

* As of 31 August

PEOPLE MOVES AS BANKS HAVE PULLED BACK FROM CERTAIN READER Moore Capital hires SAC’s SURVEY ACTIVITIES, HEDGE FUNDS HAVE STEPPED IN – IN WHICH AREA HAVE THEY MADE THE BIGGEST former London counsel IMPACT? Famida Daniels joins ex-colleagues recruited earlier this year

THE FORMER in-house spent seven years at Asset-based finance 27.3% counsel and compliance Cohen’s firm, until it closed officer in the London office $11bn its European headquarters Niche areas such as litigation finance of SAC Global Investors has in London following a or receivables factoring 18.2% AMOUNT MOORE been hired by Moore Capital CAPITAL NOW RUNS series of insider trading Peer-to-peer (P2P) lending 18.2% Management’s European THROUGH ITS TWO scandals. The firm, which division, HFMWeek has MAIN OFFERINGS has converted to a fam- Real estate bridging loans 18.2% learned. ily office mainly managing Lending to small and medium-sized Famida Daniels has started in the Cohen’s fortune, has been renamed businesses 9.1% London office of Louis Bacon’s hedge Point72 Asset Management. fund firm, joining a contingent of for- Moore Capital, founded by Bacon None 9.1% mer SAC colleagues recruited earlier in 1989, declined to comment on the this year. hire. The New York-headquartered She was added to Moore Europe firm now runs around $11bn through Capital Management’s filing with the its two main offerings, according to The impact hedge funds have made in areas vacated FCA as a partner on Friday. HSBC data. by banks following the fi nancial crisis is explored in this Moore hired a nine-strong team The $4.6bn Global Investment of seven portfolio managers and two fund is down -3.94% for the year week’s issue (see page 16). Asset-backed fi nance has analysts from SAC in London at the through 18 September, while the been affected most, according to readers answering start of this year, in the biggest collec- $6.4bn Macro Managers fund is up this week’s survey question, while lending to small and tive exit from Cohen’s firm as it closed 3.10%. The pair made 17.02% and its European base. 13.49% in 2013, respectively. medium-sized businesses has felt least impact. Daniels joined SAC in 2007 and [email protected]

PEOPLE MOVES chunk being put up by the founders. PEOPLE MOVES Bremner Capital adds It is led by Dr Christopher Bremner, LODESTAR APPOINTS COO WHERE BANKS COO as assets climb previously one of three portfolio managers at the once-$20bn activ- PORTFOLIO MANAGER GURDON Mer- FEAR TO TREAD HEDGE FUND ACCOUNTING ist firm Atticus Capital and Tancredi chant at San Francisco-headquartered veteran Dominic Eccles has joined Marchiolo, previously of Arpad Lodestar Capital Group has added COO duties to his role. FEATURE London-based Bremner Capital, Busson’s EIM, the Swiss FoHF group. BANKING Merchant became COO and portfolio WHERE BANKS simple opportunity to lend money into a space that was no replacing former COO Joanne Eccles previously worked in longer being catered for by the banks or other bank-fund- manager at the long/short equity ed providers,” he says, explaining the context in which he FEAR TO TREAD seeded lending business Capital Bridging Finance Limited (CBFL), now a wholly-owned subsidiary of Omni. Omni then launched the $833m Secured Lending Fund I, which uses investor capital to provide residential and Francis, who left the firm in July. Dublin as a hedge fund accounting commercial financing, in February this year. hedge fund manager in September Clark says investors are looking for ways to put money into the real economy. “Previously, the only direct way in vestors could do this was through securitisation, which has been badly discredited. “So there’s a tremendous opportunity for institutions - like ourselves to create a conduit for money from the end Eccles moved to Bremner Capital director at IFS/State Street AIS for after working at the firm in various trad- suppliers of credit, such as pension funds and companies, directly into the real economy.”

WHERE DO THE OPPORTUNITIES LIE? For New York-based private investment firm Shadow Tree Capital, there are three big opportunities: specialty finance ing roles since March 2008. company lending, asset-based lending and secured busi in September after working in over 10 years. ness lending. “The gross returns we get from these areas is in the mid- teens. They have been particularly affected by the pull-back - of bank capital, and usually HFMWeek ate margins that are sufficient to pay those types of rates,” Prior to joining the firm, he held a left by the bankstakes apulling closer back look fromat the traditional way managers lending are activities filling a hole Henry Goodman, a principalthe at Shadow businesses Tree, involved explains. gener For Omni, the main focus so far has been short-term - operations at London-based man- Francis left Bremner Capital on 31 BY JASMIN LEITNER lending in the UK property market, on both a commercial and residential basis, which 15% annually in a fund. can yield between 12% and he onslaught of regulation aimed at curb Clark says: “No-one would go to us if they could get variety of IT systems-related positions, ing certain types of banking activity, such as financing from a bank because we’re more expensive, but lending to firms with riskier credit profiles or we’re much more willing to work with clients. ager Davide Leone & Partners since July, according to the FSA register, more unusual finance needs, has significantly - “Banks presently are only interested in cookie-cutter altered the global financial system. deals. If you fit their criteria then you can have the money and have it quite cheaply, but if you don’t then there’s no balanceT sheets moreAs banks prudently, face pressurehedge funds to manage are stepping their further discussion, they can’t do anything else for you.” in to fill the void, with hedge fund giants Cheyne Capital, including managing developer and DE Shaw and Marshall Wace among those showing an in Clark adds that other opportunities, such as European- wide real estate debt or asset finance, could also be of fu terest in lending or loan-related strategies. ture interest. January 2012. moving to a head of operations role Peer-to-peer (P2P) lending platforms, which match WHAT ARE THE MAIN DRIVERS? - lenders and borrowers across consumer credit, mortgages - Post-2008 regulation has restricted certain banking ac and SME-lending, are also starting to garner the attention tivities that financial authorities believe could threaten of hedge funds and other alternative players. quality assurance environments for the the viability of the financial system during another crisis, Marshall Wace is currently deploying the £200m highlights Jens Foehrenbach, credit strategy head at Man - ($321m) it raised on the London Stock Exchange earlier Group’s FoHF arm FRM. this year when it floated P2P Global Investments, a com Bremner Capital manages $130m at LK Advisers. “In the case of lending, this has been through the impo- pany set up to invest in P2P loans and platforms. “P2P sition of higher capital re lending has the potential to transform consumer and Another driver has beenquirements,” stress in the he European adds. banking SME lending practices worldwide by disintermediating wealth management platform at Merrill system. “In 2009, European banks did not de-lever to the - the banks,” Ian Wace, CEO of Marshall Wace, commented same extent as those in the US and were then hit by credit early this year. risk being induced into their supposedly safe and liquid eurozone sovereign bond portfolios. They cut back lend P2P lending has become popular with structured credit in its Master Fund and has recorded Bremner also recently added Brian ing, especially outside their home markets. “These developments have created opportunities for BANKS PRESENTLY ARE ONLY INTERESTED IN Lynch’s development office. funds to capture businesses that had historically been - dominated by banks,” Foehrenbach adds. COOKIE-CUTTER DEALS. IF YOU FIT THEIR CRITERIA Steve Clark, founder and head of risk at London-based Omni Partners, agrees. “Five years ago we recognised a THEN YOU CAN HAVE THE MONEY, BUT IF YOU performance of 15% since its launch Way as head of trading and Sam 16 DON’T THEN THERE’S NO FURTHER DISCUSSION He takes on the responsibilities from HFMWEEK.COM STEVE CLARK, OMNI PARTNERS 016_017_HFM356_DisruptionFeature.indd 16 ” in September 2013. Kelly as investment analyst. Way has owner and president Scott Fenton who 9-15 OCT 2014 HFMWeek had previously report- held positions at Atticus Capital, will focus on other aspects of the firm. ed that Bremner was thought to Oppenheimer and the Bermuda Lodestar declined to comment. FEATURE P16 have launched with less than $50m Central Bank. [email protected] under management, with a significant [email protected]

9-15 OCT 2014 HFMWEEK.COM 5 AUGUST 2014 VOLATILITY COMMODITY SUB-INDICES MACRO SUB-INDICES TRADING INDEX TRADING INDEX EQUITY STRATEGIES TRADING INDEX QUANTITATIVE AUG 14 2.05% AUG 14 3.89%

INDICES AUG AUG AUG 2014 EST 2014 EST YTD 4.80% 2014 EST YTD 6.56% ABSOLUTE -0.67% 0.82% 1.16% TRADING STRATEGIES DISCRETIONARY RETURN YTD YTD YTD INDICES 2014 EST 2014 EST AUG 14 0.59% 2014 EST AUG 14 -0.70% SOURCE: Newedge YTD 3.86% YTD -3.37% Group -2.25% 4.01% 0.23%

PEOPLE MOVES PEOPLE MOVES PEOPLE Balyasny makes MOVES Emerging markets pro from another European hire BALYASNY ASSET Management Raveneur Investment BNP Paribas joins Caxton Group has hired Alexan- has hired equities specialist Torbjorn dra Zarrilli as director of Alexandre becomes latest recruit to $8bn US firm’s London office Andreassen to join its London office. business development. Andreassen joined the Chicago- Zarrilli joined Mark Black’s CAXTON ASSOCIATES HAS Alexandre is the latest hire by US headquartered firm from Bell fi rm on 15 September from hired BNP Paribas’s former head of hedge funds based in London, follow- Rock Capital Management on 30 $1.3bn Merchants’ Gate emerging markets proprietary trad- ing a wave of recruitment this year September and will work as an equi- Capital. ing, who becomes the latest recruit to by firms such as Moore Capital, York ty generalist portfolio manager, a the $8bn firm’s London base. Capital Management and Balyasny spokesperson confirmed. EM specialist Finis- Jean-Luc Alexandre was added Asset Management, which has just At Bell Rock, formerly known as De terre Capital has hired to Caxton’s filing with the FCA on hired a new manager from Bell Rock Putron Fund Management (DPFM), Christopher Buck as Wednesday. He becomes the 35th Capital Management (see right). Andreassen was an equity portfolio head of credit research. Caxton employee currently autho- Caxton was started in 1983 by Bruce manager for seven years. Formerly head of LatAm rised by the UK regulator. Kovner, who relinquished day-to-day Balyasny, founded by Dmitri corporate credit research at He worked for BNP Paribas control in 2011 by appointing manager Balyasny in 2001, has added sev- Barclays, Buck joined the between 2007 and 2014, eventually Andrew Law as chairman and CEO. eral staff to its London office this London-based fi rm on 29 leading the French bank’s emerging The firm hit the headlines last year, including former OVS Capital September. markets effort. week after it emerged that Goldman partner Manuel Blanco and former Details on his new role could not Sachs had bought a 10% stake via its Meditor Capital portfolio manager Quad Group has hired former COOs David Spring be obtained and Caxton declined to Petershill II fund. Paul Newton. and David Horowitz from comment, as did BNP Paribas. [email protected] [email protected] Clinton Group and Ban-

yan Capital respectively. In PEOPLE MOVES the same role, Spring will oversee day-to-day opera- JP Morgan hires Rasini tions, while Horowitz will be Fairway CIO a managing director. JP MORGAN HAS hired former Charles Hopkinson-Wool- Rasini Fairway Capital CIO Karim ley is joining $2.2bn UK Leguel as head of EMEA Client asset manager NewSmith Strategy. as head of alternatives Leguel started in the newly created and products from Tyrus role with JP Morgan’s alternative asset Capital. management division last Monday, a spokesperson at the investment bank Dexion Capital has hired confirmed. Cheyne Capital’s interna- The industry veteran, who has tional sales and distribution worked at Rasini for over 15 years head Max Nardulli. In a similar role, Nardulli will be in various positions, will work along- responsible for Dexion’s side portfolio managers to provide distribution strategy. “specialist” investment knowledge to clients. THE WEEK He will also be responsible for PEOPLE MOVES ensuring clients’ investment needs SPONSORED BY Cloud-based technology is increasing in importance, subscribers at last are met across the platform, the week’s US breakfast briefi ng were told. Panellists Robert O’Boyle, of event spokesperson added. sponsor Liquid Holdings Group, David Rhudy, Peter Lupoff and Chris Latterly at Rasini, Leguel was head DiNigris pointed out that investors were increasing their scrutiny of a of RF Capital, an alternative Ucits seeding platform and CIO for the fi rm’s cloud provider, and that having a recognised brand name was as London and Zurich-based firm’s alter- important as having recognised audit, legal and admin fi rms on board. native investment solutions business. [email protected]

6 HFMWEEK.COM 9-15 OCT 2014 $3bn 4.4% $130m 5-4 14

Pershing Square to launch listed Brevan Howard’s main macro Bremner Capital sees steady San Diego’s pension board votes Months it took for Spain to pub- fund on 13 October fund has best month in three asset-rise since September to maintain outsourced CIO lish a draft AIFMD decree after years 2013 launch contract with Lee Partridge the directive became EU law WEEK IN NUMBERS

LAUNCH Investcorp plans alternative “fourth pillar” Clients will get access to hedge fund risk factors with lower fees

ALTERNATIVES MANAGER Erdely declined to provide further Investcorp is planning to expand its details on the range of products, or the business with the launch of an alter- fees that will be charged, as they were native beta-focused offering in the still being finalised. next year. Investcorp has made several hires In what will be the “fourth pillar” of as part of its preparations for the Investcorp’s $5bn hedge fund division, project, including the addition of investors will have access to bench- former VP and port- marking tools for their existing hedge folio manager Yi Lu from Columbia fund exposures, and will be able to Management Investment Advisors. allocate to portfolios of “risk factors” Lu has been charged with leading as an alternative. Investcorp’s quantitative research on Investors will be able to access performance and risk factors on hedge risk factors such as relative value, dis- fund strategies, and to continue to persion, correlation, volatility and deepen its portfolio analytics and opti- THE WEEK momentum through a portfolio of rep- misation techniques. Brevan Howard’s flagship macro fund saw its highest licator products selected by Investcorp, The firm also announced last Lionel Erdely, head of hedge funds, month that Rebecca Hellerstein, pre- monthly gain in three years, boosted by the rising US dollar. told HFMWeek. viously a strategist at JP Morgan, had The fund returned 4.4% in September, according to an inves- “These risk factors can come joined to work in a newly created role tor letter cited by Reuters, beating the average 1.5% gain through index replication, use of swaps, as cross-asset strategist. by peers over the same period. The positive performance options and other derivatives, as well as Erdely added that the fourth pillar other products provided by traditional would be complementary to the firm’s helped reverse the losses incurred by the fund in seven of asset managers, investment banks and existing hedge fund offerings, which the last nine months. other firms in the market,” Erdely said. include customised FoHF portfolios, a URE “We will do due diligence on the single manager seeding platform and a solutions available and, using the portfolio of special opportunities and SWEET

an average of $500,000 annually over the last few years expertise we have built in understand- co-investments. to promote financial literacy and microfinance, and A SWEET Leg To Stand On’s (ALTSO) Hedge Fund Rocktober fest in New York and Chicago last year raised approxi- - mately $500,000 combined to provide children in devel- oping countries with prosthetic limbs and life-altering CHARITY surgeries. A newer charity, Portfolios with Purpose (PwP), founded in 2011, hosts an annual stock selection compe HFMWeek tition where hedge fund managers and other investment takes a look at the hedge fund industry’s various - philanthropic endeavours, and finds out what motivates managers professionals compete on behalf of their favourite chari ties. It has raised $474,100 since its inception, receiving to support certain charities - the most money this year, $264,100, an increase from ing these risk factors, will choose the Look out for HFMWeek’s profile of BY ELANA MARGULIES $185,000 in 2013 and $25,000 in 2012.

CHILDREN ith giving season just around the cor With the money raised from the New York Gala, along ner, hedge fund-backed charities and- with galas and smaller events in other cities around the professional associations around the globe, HFC has given out 100 grants totalling more than globe are continuing to build on the $40m to non-profits that work to prevent and treat child billions of dollars already raised col abuse. lectively to fund initiatives that are- Rob Davis, managing director at McAlinden Research closeW to their hearts. Partners, founded the organisation in the autumn of The Robin Hood , started by hedge fund 1998, a pivotal period in the hedge fund industry as it luminary Paul Tudor Jones, has raised more than $1.95bn dealt with the effects of Long Term Capital Manage best products to implement our views Lionel Erdely in the next few weeks. since its inception in 1988 to fight poverty in New York, ment’s downfall. He says preventing child abuse was a - raising $60m at its most recent annual gala in May. cause he felt passionate about since his time working as a Hedge Funds Care (HFC) raised around $2m at this year’s New York Open Your Heart to the Children Ben efit to prevent and treat child abuse, five times the amount - FEATURE P22 raised at its first event in 1999, while 100 Women in Hedge [PREVENTING CHILD ABUSE] WAS A CAUSE I COULD Funds (100WHF) has raised over $33m since inception for charities focused on women’s and family health, educa- BE REALLY ENTHUSIASTIC ABOUT AND IT WAS tion and mentoring, receiving $1.27m at last year’s annual New York Gala. PARTICULARLY MEANINGFUL TO ME Additionally, High Water Women (HWW) has raised ROB DAVIS, MCALINDEN RESEARCH PARTN on each factor.” [email protected] 22 HFMWEEK.COM ” ERS

9 022-023_HFM356_Philanthropyfeature indd 22 -15 OCT 2014

     

       

9-15 OCT 2014 HFMWEEK.COM 7 INVESTOR

If you would like to comment on any investor-related KOREA POST SAVINGS OKLAHOMA WILTSHIRE COUNTY PERMAL GROUP news story or development, BUREAU FIREFIGHTERS’ PENSION COUNCIL contact Alex Cardno, TOTAL AUM $65bn & RETIREMENT SYSTEM TOTAL AUM $2.76bn HFMWeek investment editor, ACTIVITY Seeking manag- TOTAL AUM Not disclosed CONSULTANT Mercer at [email protected] ers offering multi-class CONSULTANT Bogdahn Group ACTIVITY Started searching TOTAL AUM $22.3bn strategies for ACTIVITY Seeking FoHF and for multi-asset credit and ACTIVITY Eyeing opportunities SEARCH LOG CONTINUES Global Tactical Asset Allocation global tactical asset allocation absolute return fixed income in event-driven and macro

ON P12 ACTIVITYSEARCH mandate managers to run $50m each managers strategies

ALLOCATION INVESTOR AGAINST THE GRAIN IN BRIEF UK’s Avon pension decides AVON’S DECISION TO MAINTAIN ITS FOHF US pension funds including to stick with FoHFs exposure contrasts to the steps its UK the State of Wisconsin public peers have taken Investment Board have £3.29bn fund will maintain its current target exposure of 5% in recent months. While some have chosen single-manager hedge funds, been identified as potential others have favoured diversified growth buyers for the California THE £3.29BN ($5.32BN) AVON has not yet decided how to imple- funds or other alternatives. The £1.8bn Public Employees’ Pension Fund has decided to main- ment the recommendation to keep ($2.91bn) scheme for Dorset County Retirement System’s tain its allocation to FoHFs instead of their FoHF exposure, according to decided in March to replace its roughly $4bn hedge fund portfolio, opting to hire single manager hedge assistant investment manager Matt 4% allocation to FoHFs Gottex and according to reports. funds, HFMWeek has learned. Betts. International Asset Management with The pension fund committee for HFMWeek understands the an infrastructure portfolio while Wiltshire Performance Trust Asset the scheme, part of Bath and North scheme will decide at its December County Council pension scheme decid- Management (PTAM), a East Somerset Council, approved a meeting whether to maintain the ed to redeem from Jubilee Advisors near-$1bn Chicago-based recommendation on Friday to main- existing FoHF mandates it has with (previously Fauchier Partners) after put- firm, has seen its newly- ting it on watch in 2012. launched fixed income fund tain its current target exposure of 5% Gottex, Signet and Stenham or boosted by a $50m alloca- to FoHFs, following a review. whether to hire new managers. tion from an undisclosed JLT conducted the review, which The three firms take up 4.9% of the required to select single managers, . The began in February, to help Avon portfolio, managing £57m ($92m), Betts added. allocation increases assets decide whether to “retain some or £66m ($105m) and £38m ($61m) FoHF performance is positive at the PTAM Dynamic Fixed all of the current portfolio and/or respectively. YTD, according to Hedge Fund Income Fund to $85m. select new FoHF manager(s), or go The decision to maintain FoHFs, Research, with the HFRI Fund down a single multi-strategy or sin- as opposed to hiring single managers, Weighted Composite Index up 3.84% Alameda County Employ- gle strategy manager route”, papers was made due to the “diversification” despite seeing declines during four ees’ Retirement Associa- seen by HFMWeek at the time stated. FoHFs can provide, and because of months of the year. tion’s (ACERA) investment The UK local authority scheme the level of expertise and resources [email protected] committee has approved a $100m commitment to Lighthouse Investment STRATEGY Partners. The capital will ALLOCATION Hitchwood’s allocation follows a be allocated to a low beta/ Salient’s Lee Partridge Colorado pension signs period of significant allocations to high alpha absolute return survives San Diego vote new $42m ticket hedge funds by FPPAC. fund run by the $8.2bn In July this year, the pension fund asset manager. SAN DIEGO COUNTY’S pension A $4.1BN COLORADO pension invested $200m in Winton Capital

The Bank of Singapore is board has voted by five to four to con- plan has added to its hedge fund Management to run a long-only building a new invest- tinue a controversial outsourced CIO exposure, with a $42m investment in global equity strategy. ment and operational due contract with Salient Partners and Lee Hitchwood Capital. That hire followed a $40m invest- diligence framework to Partridge. The Fire & Police Pension ment in Graham Capital in April, allow its private bank clients SDCERA began a five-year contract Association of Colorado (FPPAC) which came just months after to invest in hedge funds, with $23bn Houston-based asset man- hired long/short equity fund FPPAC made its debut spend in according to reports. To ager Salient on 1 October, but certain Hitchwood Capital following a the managed futures space by split- date, the bank has focussed board members criticised Salient’s September board meeting. ting $80m between Winton and more on offering long-only fees and its use of leverage to generate Hitchwood Capital launched in BlueCrest’s BlueTrend. investment products. returns. Salient has been paid $17.5m June and marked the return of James AQR were also hired by FPPAC in fees since it first took on the portfo- Crichton to the hedge fund industry in December last year with a $100m INVESTOR IN BRIEF lio in September 2009. following the closure of former firm ticket split equally between AQR SPONSORED BY The new contract’s fee structure was Scout Capital earlier this year. Delta and AQR SPF. That followed 10bps, but one SDCERA trustee esti- The retirement system’s CIO, a $45m allocation to MKP Capital in mated this would push fees to more Scott Simon, told HFMWeek the October 2013. than $50m over the contract’s dura- board supported “continued imple- FPPAC, which is advised by tion. It was proposed the contract be mentation plans”, but could not Albourne, has 10% of investments cancelled, but the motion failed fol- be more specific on when further tied up in its absolute return port- lowing a three-hour board debate. hedge fund investments will hap- folio. [email protected] pen. [email protected]

8 HFMWEEK.COM 9-15 OCT 2014 COMPLIANCEINVESTORREGULATION INDEX

If you would like to comment on any 15 OCT 14 20 OCT 14 30 NOV 14 22 DEC 14 5 JAN 15 compliance-related news MAD II AIFMD – UK UCITS V RESOLUTION MIFID II story or development, Consultation closes Certain full-scope Esma to submit DIRECTIVE/CRD Comments due on contact Maiya Keidan, on draft regulatory managers begin technical advice on Consultation ends on the definition of HFMCompliance editor, at and implementing submitting Annex IV for delegated acts to EBA consultation paper derivatives as financial [email protected] technical standards the period ending on European Commission on when an institution instruments 30 September is considered ‘failing’ or ‘likely to fail’

REGULATION REGULATION NFA chastises members ENFORCEMENT for missing deadlines SEC examiners deny THE SEC LAST WEEK ACCUSED THE NATIONAL FUTURES deficiency mandate two individuals of trading on Association (NFA) has issued a insider information on Herbalife. warning to CPOs and CTAs to file OCIE staff tell all in exclusive HFMWeek interview The agency said Filip Szymik reports on time after deadlines con- and Jordan Peixoto had advance tinued to be missed. EXAMINERS FROM THE One GC at a $5bn-plus New knowledge that hedge fund A number of members are fail- SEC’s Office of Compliance York hedge fund firm said she manager Bill Ackman had taken a $1bn short in the company it ing to file Form-PR and Form-PQR Inspections and Examinations thought examiners were single- branded a “pyramid scheme”. within the required periods, the (OCIE) have denied a mandate minded in looking for errors. Szymik was ordered to pay back self-regulatory organisation said in to find deficiencies at every hedge She said that one of their com- the $47,100 he received in profit a notice to members last Wednesday. fund manager they review in an ments following an inspection from purchasing Herbalife put Form PQR filings are due within exclusive interview with sister instructed them to change the options one day ahead of the 60 days of the quarters ending in magazine HFMCompliance. date in a footnote even though the announcement. March, June and September and “We do not have a mandate date was correct in several other within 90 days of the December that we have to come back from circumstances. quarter-end. an examination with a deficiency,” Another GC at a $1bn US firm diate an issue during the exam Form PR filings are due within 45 said senior specialised examiner noted the infractions were equally process, that’s often an efficient days of each quarter-end. Marc Wyatt, who was previously a minor and that the manager had means of recovery.” “Despite the importance of this partner at global multi-strat hedge disagreed with the SEC on wheth- Jane Jarcho, head of the SEC’s information, each reporting period a fund Stark Investments. er they needed to change. investment adviser/company number of members fail to file these His comments follow sev- Wyatt also said that “by no examination programme, echoed reports in a timely manner,” said the eral operations profession- means is enforcement the sole Wyatt’s sentiments. NFA. als at hedge fund firms telling means to get a recovery for an Turn to page 19 for more from “Members should be aware that HFMCompliance that they feel the investor”. the exclusive interview. failing to timely file these reports is SEC is determined to find fault. “If a registrant agrees to reme- [email protected] a violation of NFA rules and may subject the member to disciplinary action.” REGULATION It noted that in September its business conduct committee issued Spanish Finance Ministry complaints against two firms for not reveals draft AIFMD law abiding by its compliance rule. The agency also updated its CPO SPAIN HAS EDGED closer toward Form-PQR to reflect “minor chang- the implementation of Europe’s es”, adding text on the cover page AIFMD with a new set of draft laws specifying that reporting must be in intended to transpose the Directive US dollars and any amounts convert- published only in Spanish on 19 ed to US dollars must use the con- September. version rate on the reporting date. The Spanish Ministry for Certain information about vari- THE WEEK Economy and Competition revealed ous relationships, such as third-party the 60-page Royal Decree, which administrators, is also now required. An Australian Supreme Court ruling has prevented the will combine the new AIFM leg- The updated form will be avail- Pacific island of Nauru (pictured) from sliding into financial islation with pre-existing Ucits able from 6 October in the electron- ruin in its battle against New York-based Firebird Man- laws. ic EasyFile system for the quarter The draft is open to comments ending on 30 September. agement. The hedge fund has claimed it is owed A$31m until 7 October to be submitted via For CPO PQR XML filers, an ($27m) by the Nauru government for now-defaulted bonds email to [email protected]. updated schema is also available for its Firebird Global Master Fund owns, and has obtained a The AIFMD first came into law upload in the XML Documentation court order to freeze the nation’s bank accounts. The move across Europe on 22 July 2013, but section of EasyFile. several countries have lagged in There are no changes to the CTA would have prevented the island from paying its public implementation, including Spain and Form PR this quarter. servants or providing basic services. Italy. [email protected] [email protected]

9-15 OCT 2014 HFMWEEK.COM 9 LAUNCHES& CLOSURES If you would like to comment RIVERCREST CAPITAL PRIVIUM FUND KINTBURY CAPITAL CRESS CAPITAL on any start-up-related MANAGEMENT MANAGEMENT news story or development, contact Elana Margulies, NAME RiverCrest Global Equity NAME Privium Sustainable HFMWeek chief reporter, at [email protected] Ucits Alternatives Fund STRATEGY Ucits-compliant STRATEGY Micro finance and STRATEGY US long/short LAUNCH ACTIVITY global long/short equity sustainable real estate equity CONTINUES LAUNCH DATE AUG 2014 LAUNCH DATE Q4 2014 LAUNCH DATE Q4 2014 LAUNCH DATE Nov 2014 ON P13 LAUNCH ACTIVITY

LAUNCH ACQUISITIONS Good Harbor buys 13-year Morgan Stanley GOING LIVE Broadmeadow Capital IN A BUSY MONTH FOR TRIUM, GOOD HARBOR FINANCIAL vet leads London launch the first fund to be launched on its new Ucits platform, which (GHF), a $10bn firm based in Cress’s l/s equity strategy wins Trium’s biggest seed ticket works with third-party funds, Chicago, has acquired Boston invest- is also aiming to go live in the ment manager Broadmeadow Capital. A VETERAN TRAD- New York, from where next few weeks. The acquired firm manages a ER OF US equities, he has just relocated. Thomas Karlovits, who Global Tactical Asset Allocation who led a global prop $ m His firm is in the pro- previously headed up equity (GTAA) portfolio via separately man- trading desk during 10 cess of hiring another research at Kepler Cheuvreux, aged accounts (SMAs), while Good 13 years at Morgan employee to work on is heading up the Blackwall Harbor runs its strategy via SMAs and CRESS CAPITAL’S SEED Capital Investment offering, a Stanley, will be the lat- FROM TRIUM CAPITAL – investments. All opera- long/short equity fund based in liquid alternatives. est manager to launch ITS LARGEST TO DATE tional support will be Geneva, Switzerland. Following the acquisition, GHF is a hedge fund on Trium provided by Trium’s expected to launch a levered version Capital’s London- platform, while a mar- of Broadmeadow’s offering, probably based platform. keting push to attract before the end of the year, according HFMWeek has learned that broader capital is planned once by former Graham Capital and to a source. Next year it is expected to Steven Cress will start trading the firm has started trading. AHL managers Simon Crooks roll out a mutual fund version of the with Cress Capital Management Cress Capital is one of three and Lee Bostock. That fund is strategy. The fund’s names have not on 1 November backed with new funds Trium aims to launch being backed by Trium Capital been determined. $10m from Trium, its largest at the start of November. with $5m, its standard seeding Eric Biegeleisen and David Cabot, individual seed ticket to date. The largest is Africa Merchant amount. Broadmeadow Capital’s co-founders, His new offering will trade a Capital (AMC), whose long- Trium launched Westray have become portfolio manager and US long/short equity strategy only fund looks set to launch Capital Management, a new managing director at GHF. from London, using quantita- with between $15m and $20m, long/short equity offering led The duo worked together at tive models developed by Cress of which Trium will provide less by former Lansdowne Partners Windhaven Investment Management at Morgan Stanley to select a than $5m. analyst Selvan Masil, earlier this where Biegeleisen was director of pool of stocks, which he narrows Jonathan Kruger, previously year. research until December 2012 and down and picks on a discretion- with Prescient Africa Equity The new launches bring the Cabot was head of institutional sales ary basis. Fund, is AMC’s portfolio man- number of funds it supports until March 2013. They also worked Cress joined Morgan Stanley ager while former Templewood on its main “Trium Managers together at Windward Investment in 1995 and rose to be head of Merchant Bank employee Cobus Alliance” platform to eight. Management, where Biegeleisen was a its global proprietary trading Visagie, who founded the firm, Trium Capital founder senior investment analyst between July desk employing quantitative will lead its marketing effort. Gareth James confirmed details 2007 and November 2010 and Cabot and thematic strategies. He then The third aiming to launch in a phone conversation with was a principal from June 2004. had spells at Northern Trust in next month is QSI, a new man- HFMWeek. The firms declined to comment. London and Sunrise Brokers in aged futures fund being launched [email protected] [email protected]

10 HFMWEEK.COM 9-15 OCT 2014 CONTINUES ON P13

CANDLEWOOD GOLDMAN SACHS GOLDMAN SACHS MCP ASSET BALLIOL CAPITAL INVESTMENT GROUP ASSET MANAGEMENT ASSET MANAGEMENT MANAGEMENT

NAME Goldman Sachs Long NAME Goldman Sachs MLP NAME Candlewood Puerto Short Fund and Energy Renaissance Fund NAME Terra Grove Pan Asia Rico SP STRATEGY ‘40 Act fundamental STRATEGY Alternative income Fund STRATEGY Distressed debt long/short equity focused on MLPs and energy STRATEGY Pan Asia STRATEGY Credit LAUNCH DATE Sep 2014 LAUNCH DATE Sep 2014 LAUNCH DATE Sep 2014 LAUNCH DATE Aug 2014 LAUNCH DATE TBD

LAUNCH FALLING DOLLAR LAUNCHES Allocating $1,000 to a hedge fund trading currencies in & CLOSURES Kings Peak launches, former January 2013 would have yielded less than an invest- ment with an average hedge fund SOURCE: HFR IN BRIEF

Metacapital CFO on board Former Moore Capital star Steven Cho starts new currencies fund in New York Greg Coffey has emerged as an investor in Abbeville FORMER GOLDMAN SACHS cur- across numerous asset classes includ- Partners, a London-based hedge fund started in May rency trader Steven Cho has hired ex- ing foreign exchange, interest rate by his one-time protégé Metacapital Management CCO Jason products, commodities, credit and at GLG Partners, James Kenny in the same role at new firm equities. Saltissi. Kings Peak Asset Management, which Cho spent 18 years at Goldman is due to start trading this month. Sachs, latterly as global head of G10 from Guggenheim Fund Solutions to Relational Investors, a HFMWeek has learned that he has spot and forward trading. He is sched- replace Kenny. $6bn US activist manager, appointed his sister Helen Licata as uled to meet potential investors in Licata most recently founded is shutting down because COO for the New York-based global London next month at a cap intro consulting firm Tembo Advisors in of the return of co-founder macro start-up. event organised by Goldman Sachs. 2009. Her earlier investment career Ralph Whitworth’s throat According to an investor document Kenny worked at Deepak Narula’s positions included spells at Gleacher cancer. He initially took a seen by HFMWeek, the discretionary mortgages-focused Metacapital as Fund Advisors and Citi Alternative leave of absence in July. offering will combine short-term tacti- CFO/CCO from 2007 until his Investments. cal trading with longer-term strategic departure earlier this summer. A Kings Peak spokesperson did not Neuberger Berman investments. It will seek opportunities HFMWeek reported in June that comment by press time. Group is buying Orchard in developed and emerging markets Metacapital hired Daniel Caffarelli [email protected] Square Partners, a credit hedge fund, from Ramius Capital, a major share- holder. The $475m fund will LAUNCH continue to be managed by Orchard Square’s 11-member Pershing Square to team. launch listed fund MCP Asset Management PERSHING SQUARE Capital has launched the Terra Management has announced that Grove Pan Asia Fund with shares in a new $3bn listed fund $62.5m. It will be managed will start trading on Amsterdam’s by Masakatsu Hayashi Euronext exchange on 13 October. and three other team The New York-based firm raised members, investing across $2.73bn in an initial public offer- Asia and . ing, which could be bumped up to $3.07bn thanks to an over-allotment Rasini Fairway Capital option. Its founder, Bill Ackman, has launched its second described the development as a externally managed Ucits “seminal event in the history of the fund, named RiverCrest firm”. Global Equity UCITS. Its Pershing Square said that the plan was first reported in HFMWeek earlier this year. THE WEEK shares were priced at $25, giving Goldman Sachs (its New York headquarters, pictured) has purchased a the vehicle a market capitalisation of $6.2bn. The firm added it has LAUNCHES IN BRIEF 10% stake in Caxton Associates. The move marks the third investment invested $129m of its own assets in SPONSORED BY made by Petershill II, the fund established by the investment bank a ten-year lock-up. to buy equity stakes in hedge funds. Bruce Kovner’s firm manages Ackman’s firm, which he founded in 2003, managed $13.1bn across all approximately $8bn across currencies and interest rates. Petershill II business lines at the end of June. Its bought stakes in credit hedge fund Knighthead Capital Management new fund is aimed to provide a more and equity long/short fund Pelham Capital earlier this year. permanent base of capital. [email protected]

9-15 OCT 2014 HFMWEEK.COM 11 SEARCH ACTIVITY

CITY OF MOBILE POLICE & ACTIVITY Issued RFP for hedge FIRE RETIREMENT PLAN fund consultant to take on $300m mandate A WEEKLY COMPENDIUM TOTAL AUM Not disclosed

SEARCH OF RECENT HEDGE CONSULTANT Gray & Company FUND SEARCHES AND ACTIVITY Considering up to four MORGAN STANLEY WEALTH ACTIVITY INVESTMENT MANDATES managers for possible investment MANAGEMENT To comment, contact Alex Cardno at TOTAL AUM $1.9trn [email protected] ACTIVITY Seeking long/short, event- Continued from page 8, compiled by HFMWeek AURORA INVESTMENT MANAGEMENT driven and relative value managers

SEP 2014 AUG 2014 TOTAL AUM $9.1bn ACTIVITY Mulling increased exposure ILLINOIS STATE UNIVERSITIES MERRANT FONDER TEXAS ERS to “portfolio hedge” strategies. Also

TOTAL AUM $100m TOTAL AUM $21bn researching bank merger space RETIREMENT SYSTEM TOTAL AUM $16.4bn ACTIVITY Seeking two managers in CONSULTANT Albourne CONSULTANT NEPC relative value fixed income ACTIVITY Seeking two directional JUL 2014 ACTIVITY Planning to issue an RFP in growth hedge fund managers to its first search for hedge funds invest up to $250m each SAN JOSE FEDERATED

ILLINOIS TEACHERS’ RETIREMENT SYSTEM RETIREMENT SYSTEM TOTAL AUM $2.5bn TOTAL AUM $45.3bn CARNEGIE MELLON CONSULTANT Albourne PENNSYLVANIA TURNPIKE CONSULTANT Albourne UNIVERSITY ACTIVITY Issuing mandate to hedge COMMISSION TOTAL AUM $6.8bn ACTIVITY Seeking two to three TOTAL AUM $1.07bn fund manager worth 5% of overall CONSULTANT Investment non-directional hedge funds for ACTIVITY Looking to hire two or investment portfolio Performance Services allocations of between $150m and three HFs running relative value and ACTIVITY Searching for FoHF manager $200m each strategies in the next for a mandate of around $13m six months KAZAKHSTAN NATIONAL

INVESTMENT CORPORATION

TOTAL AUM $110bn (approx)

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12 HFMWEEK.COM 9-15 OCT 2014 LAUNCH ACTIVITY

STRATEGY Event-driven LAUNCH DATE Q3, 2014

A WEEKLY COMPENDIUM LAUNCH OF HEDGE FUND LAUNCH ACTIVITY NAME Optimal Portfolio Strategy ACTIVITY STRATEGY LAUNCH DATE Sep 2014 To comment, contact Elana Margulies at [email protected] Continued from pages 10&11, compiled by HFMWeek MARATHON ASSET REPORTED OCTOBER 2014 MANAGEMENT NAME Marathon Structured Product 4010 CAPITAL LANSDOWNE PARTNERS Strategies Fund NAME 4010 Partners STRATEGY Energy STRATEGY Debt STRATEGY Equity long/short LAUNCH DATE TBD LAUNCH DATE Aug 2014 LAUNCH DATE Nov 2014

ACION PARTNERS SCOPERTA CAPITAL BLACKSTART CAPITAL STRATEGY Pan-Asia, event-driven STRATEGY Long/short TMT STRATEGY Long/short energy LAUNCH DATE Q1 2015 LAUNCH DATE Jan 2015 LAUNCH DATE Jan 2015

SYSTEMATICA INVESTMENTS WHITEBOX ADVISORS LIVINGSTON CAPITAL STRATEGY Quantitative NAME Whitebox Special Opportuni- NAME Livingston Capital Partners 1 LAUNCH DATE Jan 2015 ties Fund E and 2 STRATEGY Debt STRATEGY Long/short equity LAUNCH DATE Oct 2014 LAUNCH DATE Jan 2015 AQR CAPITAL MANAGEMENT NAME AQR Style Premia Alternative LV Fund C-VIEW PVE CAPITAL STRATEGY Low-volatility version of NAME C-View Stelrox Systematic Cur- NAME Special Situations Credit ‘style premia alternative’ fund rency Strategy Strategy LAUNCH DATE Sep 2014 STRATEGY Currency STRATEGY Structured credit and credit LAUNCH DATE Sep 2014 portfolio trading LAUNCH DATE Q4 2014 JHL CAPITAL NAME JHL Skylander Fund CITY FINANCIAL INVESTMENT STRATEGY Short-biased CO. WESTERN & SOUTHERN LAUNCH DATE Sep 2014 STRATEGY Long/short Chinese stocks STRATEGY International and pan-Asian corporate bonds LAUNCH DATE TBD LAUNCH DATE TBD PW PARTNERS NAME PW Partners Activist Fund 3 EQUITIES GLOBAL ANALYTICS STRATEGY Activist CT INVEST STRATEGY Enhanced levered short- LAUNCH DATE Aug 2014 STRATEGY European equities term LAUNCH DATE Q4 2014 LAUNCH DATE Q3 2014 SEVEN SAGES CAPITAL REPORTED-SEPTEMBER 2014 NAME Wolf Hedge Global EAGLE BAY CAPITAL STRATEGY Global macro NAME Ibis Global Partners JANUS CAPITAL GROUP LAUNCH DATE Sep 2014 STRATEGY Long/short global macro NAME Unconstrained Fund LAUNCH DATE Nov 2014 STRATEGY Unconstrained bond LAUNCH DATE TBD PERRY CREEK CAPITAL 361 CAPITAL STRATEGY Hybrid hedge fund and NAME 361 Global Long/Short Equity Fund private equity STRATEGY Long/short equity mutual LONGBOARD LAUNCH DATE Q3 2014 LAUNCH DATE Sep 2014 NAME Longboard L/S Equity Fund STRATEGY Long/short equity trend- following 40 Act PINZ CAPITAL MANAGEMENT LAUNCH DATE Q4 2014 NAME Pinz Capital International

9-15 OCT 2014 HFMWEEK.COM 13 COMMENT&ANALYSIS

include updating changes to an entity’s THE current Fatca classification with the IRS or RUSSELL MORGAN addressing a newly formed entity’s Fatca LONG Foreign Account Tax Compliance Act (Fatca) classification VIEW HEnsuring the relevant entity within the fund complex is ready to report to the relevant jurisdictions as required beginning in 2015. Though reporting will be required on cer- FATCA HAS BEEN OR WILL BE tain US and non-compliant account-hold- ers, each jurisdiction may have slightly dif- WRITTEN INTO LOCAL LAW IN ferent reporting procedures that will need MANY COUNTRIES to be complied with. BEYOND US FATCA ” UK Crown Dependencies and Overseas Territories The UK and its Crown Dependencies and Overseas Territories entered into IGAs in atca – the US international information requiring action in the next three to six months. October 2013. These agreements work in sharing regime – officially took effect For those entities that meet the relevant defini- much the same way as US Fatca, with similar on 1 July 2014 as a way to ensure that tion of ‘Financial Institution’, or otherwise fall timelines, though a later reporting date (effec- F American citizens with financial assets within the scope of Fatca, these procedures may tively, it is similar to Fatca but with a one-year outside the US report all of their global invest- include: deferral). These agreements mean Financial ment income. HProviding counterparties with the appropri- Institutions will have responsibility for identify- Though initially just a US law, hedge fund ate level of self-certification (eg Form W8) ing and reporting on investors from the UK or managers and their fund complexes have found as to each entity’s Fatca classification and as Crown Dependencies and Overseas Territories. themselves required to comply with Fatca as it required by third parties The implication for a Cayman-based fund is has become internationally adopted through HRegistration for those Financial Institutions that there is a requirement to identify and report a series of Intergovernmental Agreements located in Model 1 IGA jurisdictions to on UK resident investors as well as US citizens. (IGAs) and corresponding local legislation. obtain a Global Intermediary Identification Compliance with Fatca is now a matter of local Number (GIIN). Financial Institutions Common Reporting Standard (CRS) law in many jurisdictions. At worst, a non-com- have until 31 December 2014 to register if The CRS is an initiative led by global body the pliant entity may be subject to a 30% withhold- they have not done so already OECD, to widen the scope of tax transparency. ing tax on certain types of income. HEnsuring Fatca on-boarding procedures for All 34 member countries have endorsed the Fatca has been or will be written into local new account-holders have been in place since CRS for automatic exchange of tax informa- law in many countries. Most notably, the UK, 1 July 2014. These new procedures require tion, with 65 jurisdictions including Cayman Cayman Islands, Ireland, Guernsey, Jersey and a Financial Institution to identify all of its and the UK agreeing in principle to implement- Luxembourg have all signed IGAs with the US. investors at the time the account is opened ing CRS. Where Fatca requires reporting on As such, fund managers are finding it exceed- HPerforming due diligence procedures for US and in certain cases UK investors, CRS will ingly difficult to operate in a world without hav- pre-existing accounts (those present at 30 likely require reporting on investors from many ing to address the Fatca status of each entity June 2014) to identify accounts held by US different jurisdictions. within its fund complex or identify the Fatca persons. Generally due diligence is required CRS is still in development, but is likely status of its investors. to be completed before 30 June 2015 (or 30 to come into effect on 1 January 2016 at the While all hedge fund managers should have June 2016 in the case of low-value accounts) earliest. Q addressed their own Fatca classification by 1 HAdhering to ongoing Fatca compliance July 2014, there are a number of procedures obligations as the fund complex continues RUSSELL MORGAN, partner at EY’s hedge fund tax required to be implemented immediately or to evolve through its life cycle. This may practice

ive months ago, the 11 European Franco-German pact that aimed to push The EU Council Working Group member states participating the tax through via the enhanced co- held a meeting on the topic on 24 in implementing a Financial operation mechanism in which nine or September, so further announcements F Transaction Tax (FTT) pledged more agreeing members can implement should follow soon – although what to finalise a proposal by the end of the an initiative. shape or form they take is anybody’s year. But with less than 90 days until “The political process has made find- guess. the end of 2014, has criticism from par- ing an acceptable proposal very chal- There are also question marks over ticipating countries over the scope of lenging,” agrees Mayer Brown partner the UK’s position depending on the the tax put the brakes on this ambitious Sandy Bhogal. results of next year’s general election. THE levy? During a gruelling three-hour grill- Labour has previously indicated sup- SHORT Skadden’s James Anderson says a ing from the economics committee last port for a globally introduced FTT. final proposal is unlikely by year-end, week, UK candidate for the European “Given [Labour’s] recently announced VIEW with some previous supporters of the Commission Lord Jonathan Hill intended attack on hedge funds, may- tax, such as Germany, now only “luke- refused to offer an opinion on the FTT. be they are more interested in a fully- MAIYA KEIDAN warm” about its implementation. The current UK government is a strong fledged securities transaction tax,” notes [email protected] Germany was a key driver of the opponent of the tax. Anderson. Q

14 HFMWEEK.COM 9-15 OCT 2014 THE WEEK IN ANY INSIDE INTEL? QUOTES The Inside Hedge TIP US OFF AT: [email protected]

Guernsey lays on charm despite HK protests THE COMPLETION OF THE OFFERING OF Crown dependency unmoved by potential breakdown of social order PERSHING SQUARE HOLDINGS IS A ro-democracy protesters are currently taking part in some SEMINAL EVENT IN of the biggest street protests THE HISTORY OF THE Pseen in Hong Kong since the FIRM former British colony was handed Bill Ackman sounds a bullish note over to the Chinese in 1997. after a $3bn IPO for his new listed Tear gas has already been used to fund try and disperse the crowds, some of whom are camped out on the streets and have blockaded gov- ernment offices as they demand a free vote to elect the territory’s new leader. When Inside Hedge politely Perhaps hearing about how With all this in mind, it probably enquired that, perhaps, this wasn’t Guernsey’s wealth management BANKS ARE ONLY wasn’t the best week for a delegation the best week to be flogging your professionals can offer well bal- INTERESTED IN from the Crown dependency island wares, seeing as the territory was anced diversified growth portfo- COOKIE-CUTTER of Guernsey to head over to Hong teetering on the brink of considera- lios could be a welcome distrac- DEALS Kong to “reinforce the island’s finan- ble civil unrest and all, a representa- tion to many from worries about Omni Partners founder and head cial services offering to current and tive said the charm offensive plans the possible breakdown of social of risk, Steve Clark, on why hedge prospective Asian contacts”. were still going full steam ahead. order. Q funds are moving into the lending space This one’s for the kids Charities line up big names to raise money for vulnerable children edge fund-backed Dallas details and to join a number of for Kids. Again it will bring togeth- BY NO MEANS IS charity Capital for Kids prominent hedge fund managers er investment professionals to share ENFORCEMENT THE supports organisations and investors at the event, go to their best long and short ideas in H that educate, protect and www.capitalforkids.org support of SickKids Foundation, SOLE MEANS TO GET encourage vulnerable young peo- Separately, the Sohn Conference which funds pediatric research and A RECOVERY FOR AN ple and is celebrating its 10th year. Foundation is making its first foray initiatives for the world-renowned INVESTOR In honour of this milestone, it says into Canada on 23-24 October Hospital for Sick Children. More SEC senior specialised examiner Marc this year’s annual event, at the F.I.G for the inaugural Sohn Canada information can be found at www. Wyatt speaks exclusively to HFMWeek on Ross Avenue on 21 November, Investment Conference, a partner- capitalizeforkids.com or www. will be a special one. For more ship with Toronto-based Capitalise sohnconference.org. Q

Investment editor Technology correspondent [email protected] Designer Jack Dougherty Alex Cardno Chris Matthews +44 (0) 20 7832 6625 +44 (0) 20 7832 6656 Publishing account manager PAGEANT MEDIA [email protected] [email protected] Joakim (Joe) Nilsson Group head of content +44 (0) 20 7832 6616 Gwyn Roberts London EDITORIAL Senior reporters Data manager [email protected] +44 (0) 20 7832 6623 Third Floor Head of content Matt Smith Indira Peters-DiDio [email protected] Thavies Inn House Paul McMillan +44 (0) 20 7832 6627 +1 (212) 268 4919 Publishing account manager 3-4 Holborn Circus +44 (0) 20 7832 6622 [email protected] [email protected] Jack Duddy Chief executive Charlie Kerr London, EC1N 2HA [email protected] +44 (0) 20 7832 6613 T+44 (0)20 7832 6500 Maiya Keidan COMMERCIAL [email protected] ISSN 1748-5894. Printed by The Manson Group. F +44 (0)20 7832 6501 News editor +44 (0) 20 7832 6621 Associate publisher © 2014 all rights reserved. No part of this Will Wainewright [email protected] Lucy Churchill THE MEMBERSHIP TEAM publication may be reproduced without written New York +44 (0) 20 7832 6624 +44 (0) 20 7832 6615 +44 (0) 20 7832 6511 permission of the publishers. No statement in 1441 Broadway [email protected] Reporter [email protected] [email protected] this magazine is to be construed as an invitation Suite 3024 Jasmin Leitner to invest in hedge funds. New York, NY 10018 Chief reporter +44 (0) 20 7832 6657 Senior publishing account PRODUCTION T +1 (212) 268 4919 Elana Margulies [email protected] manager Head of production +1 (212) 268 4944 Tara Nolan Claudia Honerjager [email protected] +44 (0) 20 7832 6612 Sub-editor Rachel Kurzfield

9-15 OCT 2014 HFMWEEK.COM 15 FEATURE BANKING

simple opportunity to lend money into a space that was no longer being catered for by the banks or other bank-fund- ed providers,” he says, explaining the context in which he seeded lending business Capital Bridging Finance Limited WHERE BANKS (CBFL), now a wholly-owned subsidiary of Omni. Omni then launched the $833m Secured Lending Fund I, which uses investor capital to provide residential and commercial financing, in February this year. FEAR TO TREAD Clark says investors are looking for ways to put money into the real economy. “Previously, the only direct way in- vestors could do this was through securitisation, which has been badly discredited. “So there’s a tremendous opportunity for institutions like ourselves to create a conduit for money from the end suppliers of credit, such as pension funds and insurance companies, directly into the real economy.”

WHERE DO THE OPPORTUNITIES LIE? For New York-based private investment firm Shadow Tree Capital, there are three big opportunities: specialty finance company lending, asset-based lending and secured busi- ness lending. “The gross returns we get from these areas is in the mid- teens. They have been particularly affected by the pull-back of bank capital, and usually the businesses involved gener- ate margins that are sufficient to pay those types of rates,” Henry Goodman, a principal at Shadow Tree, explains. For Omni, the main focus so far has been short-term lending in the UK property market, on both a commercial and residential basis, which can yield between 12% and HFMWeek takes a closer look at the way managers are filling a hole 15% annually in a fund. Clark says: “No-one would go to us if they could get left by the banks pulling back from traditional lending activities financing from a bank because we’re more expensive, but BY JASMIN LEITNER we’re much more willing to work with clients. “Banks presently are only interested in cookie-cutter deals. If you fit their criteria then you can have the money he onslaught of regulation aimed at curb- and have it quite cheaply, but if you don’t then there’s no ing certain types of banking activity, such as further discussion, they can’t do anything else for you.” lending to firms with riskier credit profiles or Clark adds that other opportunities, such as European- more unusual finance needs, has significantly wide real estate debt or asset finance, could also be of fu- altered the global financial system. ture interest. As banks face pressure to manage their Peer-to-peer (P2P) lending platforms, which match balanceT sheets more prudently, hedge funds are stepping lenders and borrowers across consumer credit, mortgages in to fill the void, with hedge fund giants Cheyne Capital, and SME-lending, are also starting to garner the attention DE Shaw and Marshall Wace among those showing an in- of hedge funds and other alternative players. terest in lending or loan-related strategies. Marshall Wace is currently deploying the £200m ($321m) it raised on the London Stock Exchange earlier WHAT ARE THE MAIN DRIVERS? this year when it floated P2P Global Investments, a com- Post-2008 regulation has restricted certain banking ac- pany set up to invest in P2P loans and platforms. “P2P tivities that financial authorities believe could threaten lending has the potential to transform consumer and the viability of the financial system during another crisis, SME lending practices worldwide by disintermediating highlights Jens Foehrenbach, credit strategy head at Man the banks,” Ian Wace, CEO of Marshall Wace, commented Group’s FoHF arm FRM. early this year. “In the case of lending, this has been through the impo- P2P lending has become popular with structured credit sition of higher capital requirements,” he adds. Another driver has been stress in the European banking system. “In 2009, European banks did not de-lever to the same extent as those in the US and were then hit by credit BANKS PRESENTLY ARE ONLY INTERESTED IN risk being induced into their supposedly safe and liquid eurozone sovereign bond portfolios. They cut back lend- COOKIE-CUTTER DEALS. IF YOU FIT THEIR CRITERIA ing, especially outside their home markets. “These developments have created opportunities for THEN YOU CAN HAVE THE MONEY, BUT IF YOU funds to capture businesses that had historically been dominated by banks,” Foehrenbach adds. DON’T THEN THERE’S NO FURTHER DISCUSSION Steve Clark, founder and head of risk at London-based Omni Partners, agrees. “Five years ago we recognised a STEVE CLARK, OMNI PARTNERS 16 HFMWEEK.COM ” 9-15 OCT 2014 specialists, particularly because some platforms allow bid- ders to buy pooled loans through issued securities, explains BECOMING A BANK? Adam L’Esperance, founding member and partner at hedge fund-focused recruitment firm Long Ridge Partners. ANOTHER WAY ALTERNATIVE PLAYERS may exploit gaps in the banking system is to become “Previously, prop trading and investment groups at banks banks themselves. Industry participants have indicated that several hedge funds in the UK are would have been all over this, they would be the main in- considering such a move, although HFMWeek understands that there have been no licence vestors but they don’t exist anymore, so the hedge funds are applications made to the FCA or the Prudential Regulatory Authority (PRA) yet. filling that void,” he says, explaining that the trend is also in- forming the type of positions he now recruits for. try participants pointing to the importance of avoiding a BDCS AND BANKS liquidity/duration mismatch. Business development companies (BDCs) have also started “Our fund is set up to have matched duration. It’s a pri- gaining traction recently as a vehicle of choice to pursue the vate equity-style vehicle where you put money in, lend it plethora of opportunities out there. and only get it back when the deals have closed – you can’t These SEC-registered entities, created as an amendment take your money out half way through,” Omni’s Clark ex- to the 1940 Act to invest in small and medium-sized com- plains in relation to their fund. panies, are an attractive way to tap into the retail investor “There are competitors who have vehicles allowing in- space, says Brian Mitts, head of business development for vestors some liquidity. That works fine unless too many Highland Capital Management’s alternative products and people want to go to the door at the same time.” COO of NexPoint Advisors, an affiliate of Highland Capi- Shadow Tree’s Goodman explains its fund is a hybrid tal Management. Highland launched a healthcare-focused, vehicle, using a drawdown structure. “We enable investors non-traded BDC in August. access to this private debt market and pass through all re- “Retail investors have a desperate need for yield, and we lated income, like interest payments, structuring fees and continue to see very low rates across the board. You can royalties,” he says. typically get higher rates through a BDC-type product, and FRM’s Foehrenbach notes the “traditional” monthly there’s a lot of attraction for retail investors,” Mitts explains, or quarterly liquidity profile of hedge funds does not tally adding that BDCs can yield between 7% and 7.5% per year. with lending activities. “We see the move of liquid hedge BDCs can either be listed on a public exchange or can be funds into the lending space critically.” structured as continuous, privately placed offerings, with “We don’t invest in traditional hedge funds engaged in Highland hoping to raise $1.5bn from its continuous offer- direct lending, as the asset-liability mismatch is most likely ing. to hit funds when some portfolio companies require work- out solutions (i.e. more capital),” he says, explaining they prefer managers running more private equity-like vehicles. “We like to see that the maturity of the loans matches PREVIOUSLY, PROP TRADING AND INVESTMENT the fund structure, with the inclusion of multi-year terms and capital call arrangements, and would only include GROUPS AT BANKS WOULD HAVE BEEN THE MAIN these funds in products for clients that have an appropriate investment horizon.” INVESTORS BUT THEY DON’T EXIST ANYMORE, SO Robert Howie, head of Mercer’s European alternatives business, agrees that investors need to be aware of what THE HEDGE FUNDS ARE FILLING THAT VOID they’re getting into. “They need to understand what the terms and conditions are and that these strategies are not ADAM L’ESPERANCE, LONG RIDGE PARTNERS going be like their regular long/short equity funds.” Foehrenbach highlights another danger. Investor senti- ”And while they can be a competitor to hedge funds and ment, while constructive in creating stable, above-capital other players in the space, BDCs can also act as partners, market yields, can also create pressure on managers to Shadow Tree’s Goodman explains. invest. This can lead to “sub-optimal credit selection”, he “A lot of these deals require syndication. We might have says. an appetite to lend $5m and the company needs $15m, so “Credit due diligence is key as by nature these lending we might approach a BDC, or vice versa, and say we’re go- activities carry high risks,” he says, adding that competi- ing to do half of this deal, would you like to do the other tion for loans between funds can also create deal origina- half?” tion challenges. While Omni Partners’ Secured Lending Fund I doesn’t CHALLENGES AND INVESTOR SENTIMENT have to rely on loan origination from external sources as L’Esperance notes that hedge funds need to bring in the rel- CBFL fulfils this function, Clark explains that investors evant expertise, particularly as structuring the documenta- did question their ability to originate the amount of loans tion for these types of funds – which often have much longer they had targeted ($100m). He adds that they were “well lock-up periods and more complex terms – is expensive. ahead” of this figure. “Hedge funds are recruiting a lot of fund accountants, who From direct mortgage origination to the world of bur- are experienced in accounting for these types of strategies, geoning P2P platforms, the sub-set of opportunities and there’s also a big focus on lawyers,” he says. within the lending space is vast, with industry participants “We see a lot of lawyers who have structured these trans- indicating that the pipeline of deals, as well as the demand actions for speciality finance companies or banks coming from end consumers and business, is set to continue. to hedge funds. If managers just rely on outside counsel it As Shadow Tree’s Goodman notes: “The need for capital costs too much,” he adds. is far greater than the amount out there, and the retrench- Liquidity can also be a sticking point, with many indus- ment from banks is not going away.”

9-15 OCT 2014 HFMWEEK.COM 17

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However, Wyatt was clear that while no ban was be- ing planned, personal trading was something the SEC HFMWEEK MEETS would continue to question “because it has the potential for front-running”. He was previously a partner at global multi-strat hedge fund Stark Investments. The OCIE examiners were equally adamant in denying a mandate to find deficiencies at every hedge fund man- ager they examined. “We do not have a mandate that we THE SEC have to come back from an examination with a deficiency,” said Wyatt. His comments follow several operations professionals at hedge fund firms telling sister magazine HFMCompli- ance that they feel the SEC is determined to find fault in every exam. One GC at a $5bn-plus New York hedge fund firm said she thought examiners were resolute that they would find errors and noted that one of their comments related to the changing of a date in a footnote even though the date was correct in every other instance. Another GC at a $1bn US firm noted the infractions were equally minor and that the manager had disagreed with the SEC on whether they needed to change. Wyatt also said that “by no means is enforcement the sole means to get a recovery for an investor”. “If a regis- trant agrees to remediate an issue during the exam process, that’s often an efficient means of recovery.” Perhaps as interesting as examination priorities was the SEC’s keenness to emphasise the strong relationship it sees Jane Jarcho, head of the SEC’s investment adviser/ Marc Wyatt, senior specialised examiner, OCIE between compliance officers and the US regulator. “We company examination programme, OCIE regularly hear from compliance officers that they leverage our exam findings to get more resources,” said Jarcho. Last week, HFMWeek travelled to Washington, DC for an exclusive For its part, the SEC expects a compliance officer to interview with top SEC examiners on the main regulatory issues understand its responsibility to the SEC. “We work with for hedge fund managers. Despite side-stepping some questions, compliance officers and they should be keeping a record of the agency had some key take-homes for managers compliance issues and the response to issues raised.” Her comments follow SEC chair Mary Jo White last BY MAIYA KEIDAN October rattling compliance professionals at hedge fund managers by suggesting that a partnership should exist be- n a quiet street in Washington, DC, tucked tween themselves and the regulator. “If the SEC thinks we just a few metres behind the 100-year-old, are their partner, they need to tell us for sure,” said a GC white-pillared train station, sits the Securi- and CCO at a $1bn US firm, adding that he believed the ties and Exchange Commission building. compliance officer’s allegiance was to the manager. The towering concrete and glass structure Perhaps this view of compliance officers as partners oozes the promise of protection. And it shouldn’t be a surprise, with so many industry participants wasO in this looming block, full of framed photographs of telling HFMWeek that the SEC is more open and transpar- SEC leaders from times gone by, that HFMWeek met top ent than it has been in the past with White at the helm. examiners at the Office ofompliance C Inspections and “The SEC is putting out more guidance than ever before Examinations (OCIE). and using the media more to deliver their message to the Jane Jarcho, head of the SEC’s investment adviser/ industry,” said one deputy GC at a multi-billion-dollar US company examination programme, and senior specialised manager. examiner Marc Wyatt sat down with the magazine in Jar- cho’s office overlooking the train tracks, to discuss current important issues for hedge fund managers. SEC PRIORITIES Jarco and Wyatt side-stepped questions about ongoing SEC sweeps on cyber-security and liquid alternatives but THE SEC HAS MADE INVESTIGATING cyber-security protections and how liquid alternatives are sold were amenable to discussing general examination priori- to investors a top priority. Examiners only recently launched the cyber-security sweep while the ties, such as personal trading and deficiency letters. liquid alternatives sweep was conducted between May and July, and a full analysis of policies The examiners denied the SEC had any intention to ban and procedures at firms offering these products is set to begin on the data. However, as part of its personal trading at hedge fund firms, despite the sugges- presence exams, the SEC is also generally targeting: tion from some quarters that this could be on the agenda. 3 Outdated or inconsistent valuation procedures “The securities laws do not prohibit personal trading, but 3 Conflicts of interest there have to be policies and procedures around it,” said 3 Regular external audits of all accounts Jarcho. 3 Adequate disclosures Todd Kaplan, associate director at Kinetic Partners, said 3 Appropriate benchmark comparisons the SEC had indicated in a couple of examinations that 3 Stating actual performance, not historical back-tested returns they would like the practice to be banned altogether.

9-15 OCT 2014 HFMWEEK.COM 19 Lawson Conner Compliance. In safe hands.

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for example, is currently mulling $50m of direct and $50m of potential co-investments in the Melody Capital Partners Onshore Credit Fund. TIME TO LOOK AT Meanwhile, in February this year, the New Jersey Di- vision of Investment handed a $300m ticket to Solus Al- ternative Asset Management specifically for use in special opportunities, allowing the firm to invest up to two-thirds of the allocation in an opportunistic event-driven and spe- CO-INVESTING? cial situations credit strategy and up to two-thirds in “high- conviction co-investment opportunities”. There are often two components to co-investment, Gundle adds: “You have co-investment in other hedge Factors such as the lack of in-house expertise at larger investors funds where a pension might invest in a multi-manager have caused an increase in the number of co-investment deals fund and say they would like to allocate separately to some BY ALEX CARDNO of the individual managers in that multi-manager fund. “Then there is a trend of hedge funds working with investors themselves to supersize some of the holdings a hedge fund has conviction of. Some institutional investors s investor demand for bespoke solutions want to work with an adviser with skin in the game rather grows, more hedge funds are entering than a consultant rating a manager.” into co-investment deals to create specific strategies to meet the needs of allocators who are no longer happy to be bundled into mainstream strategies. THERE IS A TREND OF HEDGE FUNDS WORKING WITH AThe lack of in-house expertise at many big investors has been highlighted as a driver of the growth of co-in- INVESTORS THEMSELVES TO SUPERSIZE SOME OF vestment agreements where the manager creates a be- spoke strategy to be run for the investor. THE HOLDINGS A HEDGE FUND HAS CONVICTION OF Nick Vamvakas, head of Investcorp’s single manager business, explains: “Co-investments have been occurring KEVIN GUNDLE, FOHF AURUM for a few years, but now they are becoming more popular. “Investors are increasingly looking for these types of ” Gundle says fees will often work out cheaper for inves- opportunities because they do not have the in-house ca- tors in a co-investment vehicle if it is used more as an activ- pabilities to do it themselves, which is why they look for ist long-only type of investment. a partner.” But Vamvakas adds: “Every investment is driven first Typically, the process involves a manager spotting and foremost by return, then belief in the space and the an opportunity and creating a bespoke fund or special opportunities that exist. Fees are always important of purpose vehicle (SPV) designed specifically to pool the course, but I believe the drivers of co-investment are the hedge fund’s own capital with that of an investor or se- opportunities and the extra return enhancement they can lected investors to take advantage of market dislocation. provide that investors cannot get on their own.” Co-investment often occurs with a FoHF as a princi- pal investor with additional capital provided by an insti- tutional investor, which may not have in-house expertise. TALENT MOVING TO ALLOCATORS? This is particularly prevalent in the activist space, rather than popular strategies such as long/short equity, Wedded to the theme of co-investment is But cost is where the problem lies, he which lend themselves less well to the practice. emerging evidence of a migration of talent from adds, because there is some hesitation by Kevin Gundle, CEO of FoHF Aurum, says: “Co- hedge funds to institutional investors. institutions to run internal strategies due to investment tends to be a more long-term thematic ap- Jeremy Robertson, partner at executive the compensation or salary levels expected by proach. So, an activist manager might be trying to unlock search firm CT Partners, explains this is hedge fund types. value in a business, and a co-investment gives the hedge especially prevalent among smaller hedge There have also been cases where it has fund manager an ally when he might be constrained on funds struggling to raise assets, resulting in an gone the other way, with internal teams leaving what he can invest to obtain a board position. increasing migration of talent from smaller funds institutions to set up their own firm, forcing “So, an investor might inject more capital which al- to in-house teams at institutional investors the investor to rebuild or revert to external lows the manager to obtain a board position and get where the capital base is more stable. managers. their proxy vote if it comes to that. The managers sur- He says the creation of in-house teams is As Edward O’Malley, hedge fund consultant round themselves with people who are in the trenches more common among larger allocators trying at Cambridge Associates, explains: “The costs with them.” to replicate the multi-asset advisory capabilities would be lower than hiring external managers Gundle adds that with banks retrenching from risk offered by large hedge funds such as AQR or but it presents other issues around costs for due to regulatory rules and burdensome capital require- Bridgewater at a lower cost. other stakeholders at institutions, because ments, hedge funds are starting to see more special situ- “You have to be a large institution to remuneration of the people hired can be ations where they can take advantage of co-investment consider it and it’s often confined to the very controversial. opportunities. large global institutions,” Robertson explains. “Anecdotally, it’s not a one-way street. Certain There is significant interest in such deals from larger “The most common scenario is taking on US endowments have operated this way for institutions such as sovereign wealth funds (SWFs), en- internal managers to complement external years and notably some have made a shift back dowments and US public pension funds. managers.” towards more external managers.” Arizona Public Safety Personnel Retirement System,

9-15 OCT 2014 HFMWEEK.COM 21 FEATURE PHILANTHROPY

an average of $500,000 annually over the last few years to promote financial literacy and microfinance, and A Leg To Stand On’s (ALTSO) Hedge Fund Rocktober- fest in New York and Chicago last year raised approxi- SWEET mately $500,000 combined to provide children in devel- oping countries with prosthetic limbs and life-altering surgeries. A newer charity, Portfolios with Purpose (PwP), founded in 2011, hosts an annual stock selection compe- CHARITY tition where hedge fund managers and other investment professionals compete on behalf of their favourite chari- HFMWeek takes a look at the hedge fund industry’s various ties. It has raised $474,100 since its inception, receiving philanthropic endeavours, and finds out what motivates managers the most money this year, $264,100, an increase from $185,000 in 2013 and $25,000 in 2012. to support certain charities BY ELANA MARGULIES CHILDREN With the money raised from the New York Gala, along with galas and smaller events in other cities around the ith giving season just around the cor- globe, HFC has given out 100 grants totalling more than ner, hedge fund-backed charities and $40m to non-profits that work to prevent and treat child professional associations around the abuse. globe are continuing to build on the Rob Davis, managing director at McAlinden Research billions of dollars already raised col- Partners, founded the organisation in the autumn of lectively to fund initiatives that are 1998, a pivotal period in the hedge fund industry as it closeW to their hearts. dealt with the effects of Long Term Capital Manage- The Robin Hood Foundation, started by hedge fund ment’s downfall. He says preventing child abuse was a luminary Paul Tudor Jones, has raised more than $1.95bn cause he felt passionate about since his time working as a since its inception in 1988 to fight poverty in New York, raising $60m at its most recent annual gala in May. Hedge Funds Care (HFC) raised around $2m at this year’s New York Open Your Heart to the Children Ben- efit to prevent and treat child abuse, five times the amount [PREVENTING CHILD ABUSE] WAS A CAUSE I COULD raised at its first event in 1999, while 100 Women in Hedge Funds (100WHF) has raised over $33m since inception BE REALLY ENTHUSIASTIC ABOUT AND IT WAS for charities focused on women’s and family health, educa- tion and mentoring, receiving $1.27m at last year’s annual PARTICULARLY MEANINGFUL TO ME New York Gala. ROB DAVIS, MCALINDEN RESEARCH PARTNERS Additionally, High Water Women (HWW) has raised

22 HFMWEEK.COM ” 9-15 OCT 2014 teacher after he graduated college. of the largest providers of financial literacy programmes “It was a cause I could be really enthusiastic about and for middle and high school students. it was particularly meaningful to me,” he says. “There is so much demand based on what we have Additionally, as the mainstream press was vilifying the done already,” she says. “It has been a tremendous theme hedge fund sector following LTCM’s demise, he wanted and we are expanding from youth to young adults and we to demonstrate that executives were able to give back to are even getting demand to expand to parents and other those in need. populations.” As a prime brokerage executive at Montgomery Secu- Regarding microfinance, because HWW members are rities at the time, he contacted hundreds of his friends in in financial services and are global-thinking, Poe says the the industry and organised a party a few months later, organisation wanted to promote a global component to in February 1999, at New York’s historic Pierre Hotel. their volunteerism. In 2006, it launched a microfinance Attended by 400 people, it raised $400,000. The annual global risk consultancy. Open Your Heart to the Children Benefit was formed “The microfinance sector is undergoing systemic and in and further events in other areas fol- local transformation all the time,” she says. “We built our lowed. programme around our belief that financial professionals Capital for Kids, an asset management-backed charity can make the most difference using our skills to advise that funds organisations in North Texas to support at- microfinance institutions in addressing the demands of risk youth, will be celebrating its 10-year anniversary this transformation, by consulting about risk management, year and has given grants totalling $8.7m to more than growth planning and capital markets readiness.” 50 different organisations related to this cause. Reid Walker, a co-founder who currently runs Dallas- based family office Five T Investments and formerly founded hedge fund manager Walker Smith Capital, says THROUGH OUR HEDGE FUND ROCKTOBERFEST he was also passionate about helping deprived children. “To me, it is about a return on investment,” he says. EVENTS IN NEW YORK AND CHICAGO, OUR “You can make a bigger difference in a kid’s life than you can in many others.” SUPPORTERS IN THE HEDGE FUND AND RELATED Through contributions to ALTSO, more than 12,000 children with limb disabilities in the developing world INDUSTRIES HAVE HELPED US IMPACT MORE THAN have received free orthopaedic care. “ALTSO works to provide children the treatment 12,000 CHILDREN they need to access mobility and the critical opportu- GABRIELLA MUELLER, A LEG TO STAND ON nities mobility offers – like the ability to attend school and receive an education that will lead to meaningful employment,” says Gabriella Mueller, executive direc- ” PORTFOLIOS WITH PURPOSE tor. “Through our Hedge Fund Rocktoberfest events in Through PwP’s annual stock selection competition, New York and Chicago, our supporters in the hedge fund hedge fund managers and other participants can choose and related industries have helped us impact more than which charities they would like to compete on behalf 12,000 children.” of. The most supported charities thus far have been the Wounded Warrior Project, New York Hedge Fund FEMALE HEDGE FUND ASSOCIATIONS Roundtable and St. Jude Children’s Research Hospital. Female hedge fund associations, including 100WHF and “Through this contest, individuals are able to pool the HWW, have also seen members volunteer their time to resources of the group to make a significant impact on charitable causes. 100WHF’s philanthropic initiatives high-quality charities, especially those that are small, focus on three themes: women and family health; edu- underfunded and under-the-radar,” says Stacey Asher, cation; and mentoring, with these respective themes ro- founder and CEO. tated every year. PwP has recently launched PwP Mini Games to en- At the annual galas across the globe, the organisation able people or organisations to host their own stock se- picks a non-profit in one of these categories to receive lection competition, customised with their own param- the proceeds. At its New York event next month, the eters including minimum market capitalisation, entry/ Cerebral Palsy International Research Foundation will trading fees, contest duration and size. be the beneficiary. Additionally, Asher says the mini game structure “When it comes to philanthropy, it was really a desire can be paired with a corporate organisation’s training of the founding members of 100 Women in Hedge Funds programme to emphasise philanthropic causes that are to figure out a way, collectively, to make an impact on close to a firm’s heart. charitable organizations,” says CEO Amanda Pullinger. “With the ability for friends, firms, schools and chari- Since its launch in 2005, HWW has focused on pro- ties to host and customise their own games, we now moting financial literacy and microfinance through its have more fun competitions throughout the year and initiative. most importantly, more money raised for charity,” she Reed Smith partner Alexandra Poe, one of HWW’s adds. founders, says financial literacy was an important issue to Whether supporting those in real need of help and them. The lack of other initiatives in this area led them to care, such as the victims of child abuse or the casualties team up with financial industry legend Muriel Siebert in of war, or empowering people from disadvantaged back- 2009 to launch the HWW Muriel Siebert Campaign for grounds to better themselves, the huge sums raised by Financial Literacy After School. the hedge fund sector each year continues to make a real As a result of this partnership, HWW has become one difference to many people’s lives.

9-15 OCT 2014 HFMWEEK.COM 23 ALL POINTS

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The contents of these materials may constitute attorney advertising under the regulations of various jurisdictions. SPONSORED FEATURE

ance with auto-enrolment regulation. Th e research found that although auto-enrolment has generally been well-re- FOCUS ON ceived, 40% of organisations not yet past staging date say auto-enrolment is the biggest challenge their organisation will face over the coming years.

THE PLAN WELL AHEAD When asked to pass on a piece of advice to organisations AUTO-ENROLMENT that have yet to begin planning, the more experienced ex- ecutives in our research repeatedly mentioned the impor- tance of planning and having a realistic implementation CHALLENGE timetable. One in six (17%) organisations that have al- ready reached their staging date said they would have start- ed planning much earlier if they were to have their time over. A third (34%) said auto-enrolment took more time to implement than expected. It is a concern, therefore, that Kimberly Bradshaw, managing director of Buzzacott’s HR consultancy, 43% of organisations said they plan to allow less than six talks to HFMWeek about the recent results from research by the fi rm months, an insuffi cient length of time to plan, implement on the impact of auto-enrolment in the industry and communicate all the changes required.

REVIEW YOUR EXISTING PROVISION As part of the planning process, it is also vital to review the uto-enrolment legislation helps address the existing pension provision. Organisations with an exist- pension gap in an ageing population and ing pension scheme need to make sure that it qualifi es for ensures that all employees are provided for auto-enrolment. Many existing pensions are not compli- in their later years, to some extent. All em- ant and providers are very busy, so plan well in advance to ployers have to introduce auto-enrolment fi nd out what you need to know in order to make the right by 2017, irrespective of size or structure. decisions. ASome are embracing it and using it as the opportunity to focus on a number of positive changes, others are putt ing THE COST TO YOUR ORGANISATION it into place kicking and screaming. Th e research showed that organisations tend to underesti- As it is now just over a year since the legislation came mate the fi nancial investment required to implement auto- Kimberly into force, the employee solutions team at Buzzacott com- enrolment. Th e costs associated with implementation are, Bradshaw joined missioned some unique research comparing the reality of on average, a third higher for organisations that have yet Buzzacott in 2013 as those who had already been through auto-enrolment with to implement auto-enrolment than for organisations that managing director of its the expectations of those who are yet to do so. Th e results have already reached their staging date (£332 vs £107). HR consultancy. She is a were quite unexpected. Furthermore, the research showed that opt-out rates are fellow of both the RSA and actually much lower than organisations anticipated; mean- the ILM and a member of KEY FINDINGS: ing cost to the business is higher. the Association of Coach- ing. Bradshaw is also one VIEWS ON PENSIONS AS A BENEFIT COMMUNICATE AND ENGAGE of the few people to have Pensions, benefi ts and employee engagement are rapidly Th e success of auto-enrolment, just like any other wide- researched the impact of moving up the agenda for organisations across the UK. spread change impacting employees, also depends on how non-verbal communica- Almost two-thirds (64%) of employers agreed that auto- well it is communicated. Consultation with staff has been tion in leaders for her MSc enrolment has a positive benefi t to society as it encourages essential and has been used by many organisations as a thesis. employees to save more for retirement and brings impor- means of employee engagement, as well as an opportunity tant decisions about pensions to the fore. Th ree-quarters to review HR. of the organisations interviewed recognised that having benefi ts in place is important for encouraging employee Lessons learned from those who have gone through the engagement. A further 76% said a pension scheme is an process are: important element of overall employee benefi ts packages. Q Auto-enrolment need not be a headache, just plan Being able to att ract and retain a loyal, satisfi ed and en- well and don’t underestimate the workload required gaged workforce is critical for any organisation to face the Q Don’t miss out on the opportunity to use auto-enrol- opportunities and challenges ahead. ment to review wider employment engagement poli- cies CONFUSION ABOUT IMPLEMENTATION Q Seek additional support from external advisers to In spite of this, the research revealed confusion among em- give an objective view on how best to approach im- ployers about what is required of them to ensure compli- plementation when required. Q Approach auto-enrolment like any other organisa- tional change, have a realistic project plan and strong time management EFFECTIVE COMMUNICATION WITH EMPLOYEES IS A Q Eff ective communication with employees is a critical success factor CRITICAL SUCCESS FACTOR Q Support and training from external advisors is also benefi cial for a smooth planning and implementation process. Q 9-15” OCT 2014 25 HFMWEEK.COM HFM FOCUS DEPTH OF EXPERTISE AND KNOWLEDGE

With the proliferation of shared information and its wider distribution, the risk of their exposure increases. We FOCUS ON never know who is sniffi ng at it; as indicated by the revela- tions about offi cial surveillance from Edward Snowden of the National Security Agency. For retailers, as well as for Wall Street and beyond, hacking is a runaway problem. As the Washington Post re- ported last spring, the federal government notifi ed 3,000 CYBER SECURITY businesses they’d been hacked in 2013. Each week there seems to be another announcement of a major penetra- tion – to cite one of the bigger ones, we need only name Target Corp, which lost records on 40 million payment cards. Subsequently, that amount was exceeded by Th e Marc Songini, of Intralinks, talks to HFMWeek about the growing need Home Depot Inc, which possibly had 56 million records for hedge fund managers to acknowledge the severe risks posed by compromised. Network hacks are occurring constantly, and if any- cyber-attacks thing, the problem of cyber-theft is underestimated.

THE CONSEQUENCES OF BREACHES As we mentioned earlier, a hack would most likely result n the past two years, hackers have penetrated a in the loss of clients and the ruination of the business. To- number of hedge funds, according to Th e New day, it’s reasonable to assume existing and potential clients York Times. To what degree is unclear and, regret- will begin to demand a baseline of hardened security. Only tably, it’s not surprising, as hedge funds are ideal then will they begin entrusting their assets and their pri- targets for hackers. Th ese enterprises represent vate information to hedge funds. Th e increased frequency billions of dollars and they all too oft en have inad- of operational due diligence procedures by sophisticated equateI security to protect their assets. investors means security and related safeguards will be As experts note, hedge funds have spent, individually, under review. many thousands of dollars to take their operations online and to automate them. However, they haven’t suffi ciently THE GOVERNMENT IS TAKING A HARDER LINE Marc Songini has invested in anti-hacking and other security technologies, Breaches are becoming less and less of a private matt er. worked in the informa- or in the proper training of staff in best practices that sup- Th e Securities and Exchange Commission is pushing tion technology field port cyber security. for more disclosure of data breaches. In fact, the agency for many years as a We can easily imagine how the cost of being hacked and is reportedly investigating multiple companies that were journalist, analyst and losing data would be catastrophic to a hedge fund manag- hacked, to fi nd out if they had adequately guarded their marketing communica- er. A successful network penetration could mean the loss data. As part of its investment adviser examination pro- tions specialist. During his of reputation and clients, as well as offi cial sanction and gram, the SEC has promised it will conduct a review on 10 years with International lawsuits. Despite the enormous risks, many in the business the policies and safeguards asset managers have in place, Data Group (IDG), Songini tend to think all is well as long as someone else is hacked, to mitigate the risks of cyber-att acks. wrote for Network World and not oneself. Some areas where hedge funds are, or will be, reporting and Computerworld, both However, you can safely assume that aft er information about to the government include: award-winning magazines. is created and out of your hands, it will live forever. It will ? Form ADV basic fi rm and fund information Currently, he is lead writer exist in some version, and not necessarily catalogued or ? Form PF portfolio information for corporate communica- protected. So how are you to protect your client informa- ? AIFMD Annex IV reporting for EU member states tions at Intralinks. tion – to say nothing of your intellectual property? with detailed portfolio information (scheduled 2015) BETWEEN THE NSA AND HACKERS First, some background. Increasing amounts of data must HEDGE FUND MANAGERS DON’T KNOW HOW TO RESPOND be moved around in the cloud, as well as in controlled and AND PREPARE secured corporate networks. To remain competitive, fund As hedge funds’ assets have swelled, many managers’ managers (just like similar professionals in other indus- operations and infrastructures are still playing catch-up. tries), have a growing number of audiences to communi- Hackers know this and have devised a number of targeted cate with for marketing and collaboration, or for regula- methods designed to access and capture a fi rm’s most sen- tory purposes. sitive data. So to begin, you should consider where you might be Th ey att ack by: facing exposure. Potentially sensitive data types include: ? Hacking a broker’s account to steal user names and ? Your clients’ IDs, social security numbers, and bank passwords, and then trade securities using the vic- and custodial account information tim’s ID ? Your ‘secret sauce’ – the investment strategy data ? Denial-of-service assaults (DoS att acks) that makes you successful ? Using ransomware to lock down data until a bribe is paid Th e recipients of the data sent include: administrators, prospects and clients, state or federal regulators, vendors Securing IT infrastructure is now a requirement, not an and colleagues. Th ey are oft en geographically distributed option. Managers must double-down and commit more and there is no way for you to know the relative strength of resources and focus to data security. Making this task each network and server that will house the data. more complex is the fact that, frequently, IT operations

26 HFMWEEK.COM 9-15 OCT 2014 SPONSORED FEATURE

are outsourced, so managers must be ready to demand documentation from their service providers.

HOW TO PREPARE CYBER SECURITY IS NOW OF GROWING CONCERN FOR Cyber security is now of growing concern for many hedge fund firms. You don’t want to be left behind, given that MANY HEDGE FUND FIRMS. YOU DON’T WANT TO hardened security will most likely prove to be a competi- BE LEFT BEHIND, GIVEN THAT HARDENED SECURITY tive advantage. Regulators and clients are going to press managers to offer the most ironclad assurances that their WILL MOST LIKELY PROVE TO BE A COMPETITIVE data is as secure as reasonably possible. We recommend you start by changing your mindset. ADVANTAGE Remember, success and growth aren’t just matters of managing investments. They are also about prioritising your IT, operations and security. You need to begin exam- ining your approach and to collaborate more closely with your IT personnel or service provider to make security as ” 7 Proactively learn how to detect suspicious network strong as possible. activity A useful way to look at cyber security is to identify po- 7 Review how you interact remotely with third-parties tential risks in your networks and data storage systems in 7 Define best practices for security and confidential- advance. Some checklist specifics: ity and establish a procedure for internal governance 7 Educate yourself. Learn about the importance of se- that ensures compliance to these guidelines curity, data privacy and compliance 7 Train your employees in these best practices, such 7 Do a deep risk assessment dive. It’s impossible to as when and how an employee accesses or shares a forecast and mitigate data privacy risks without customer record knowing all of the technologies your organisation 7 Think about protecting information, both at rest and employs in transit. High-level advanced encryption standard 7 Keep track of your assets. Organisations should (AES) protection is desirable keep detailed logs of all activity around their data. 7 Shop for the right tools 7 Ask yourself: are the basics in place, such as antivirus 7 Pick your partner wisely: Working with responsible or monitoring applications? Besides the basics, you and knowledgeable vendors can ease your burden – also need to see where else you must make improve- a poor partner can make the load much heavier ments 7 Get down to the document level. Any vendor worth 7 Evaluate your collaboration assets. Make sure you its salt must provide centralised visibility and com- use the most suitable and secure (and easily adopt- pliance monitoring capabilities – for the lifetime of able) work apps. every document you own. 7 Consider vulnerabilities that might arise during re- mote customer access sessions, or when there is a TAKE YOUR DATA AND APPS SERIOUSLY fund transfer request Remember, as a steward of investor capital, safeguarding 7 Ask yourself: does my current vendor or home- your clients’ information is your responsibility; the burden grown system come up lacking? is on you. Start now. Q

9-15 OCT 2014 HFMWEEK.COM 27

SPONSORED FEATURE

model, which remains fi t for purpose and well understood by managers and investors alike. Investment strategy de- FOCUS ON velopment has followed a fairly predictable path in terms of trying to identify new areas of volatility where gains can be achieved. Th ose strategies do not appear to be revolu- tionary, rather evolutionary and very much a refi nement of investment strategies that we have seen in action for a number of years. While capital and gains are available, my SIGNS OF LIFE impression is that no one is yet prepared to admit that the global economy is fundamentally healthy again, and cer- tainly not back to pre-crash opportunities.

HFM: How do you think the hedge fund admin sector Colin MacKay, group director of Elian, speaks to HFMWEEK about the will change and develop over the next fi ve years? ongoing Fatca fallout and the increasing need for admin consolidation CM: Consolidation. Th e increased regulatory, data gather- ing, storing and reporting obligations on funds aff ect admin- istrators every bit as much as they do managers and so the need to develop and maintain current operating and data HFMWeek (HFM): 2014 has been an eventful year for management systems to be able to obtain, process, store hedge fund managers in terms of regulatory develop- securely and report on the required data in an effi cient way ments. In which fi nancial centre have you encountered to meet regulatory reporting requirements is likely to the most challenges and how have you overcome them? consolidation in the mid-market sector in particular. Colin MacKay (CM): Interesting question, can I say all of them? We have seen a wide array of legislative and regula- HFM: What do you think the current outlook is for tory challenges with the global impact of Fatca, following new hedge fund activity? not only its coming into eff ect but also the progression of CM: It appears strong, certainly stronger than we have IGAs and implementing legislation. Changes in the US seen for a few years. Th ere is capital available and while the have included new rules or clarifi cation/guidance from number of start-up managers is nowhere near the heydays Colin MacKay is CFTC and SEC, as well as revised directions to auditors of 2006/7, we are starting to see more new market en- group director of Elian from the PCAOB which will likely impact audit prepara- trants. Th ere is a generational move that is primed to take with global responsibil- tion and completion. At the same time, AIFMD has rum- place and the timing will be driven by the confi dence of ity for fund services. He bled on, aff ecting a growing proportion of jurisdictions, the individuals concerned and the institutional investors’ joined the group in 2003 managers, funds and investments. We have also seen in- willingness to back their new ideas and approaches. becoming a director in creased regulatory overlay in Cayman with the introduc- 2007. A qualified solicitor, tion of the Directors Registration and Licensing Regime. HFM: How can hedge funds deal with the ongoing he is a member of the Every one of these developments impacts the environment pressures to keep business costs to a minimum? Cayman Islands Law So- in which hedge funds operate and adds to the existing bur- CM: With the regulatory burden ever growing, the tipping ciety, the Cayman Islands den of regulatory compliance, information gathering and point comes when the cost of compliance adversely aff ects Directors Association and reporting, which impacts managers and their funds. How the net return for investors. If the alternatives industry is deputy chairman of have we overcome them? We have continued to work with cannot address the regulatory costs while still delivering AIMA, Cayman. our clients to consider the issues, construct or support enhanced returns, there is a much bigger problem for us relevant solutions and put in place the right control and all. As I mentioned earlier, the manager/client drive to- reporting mechanisms to meet or mitigate each challenge. wards enhanced back and middle offi ce services from ad- ministrators, to leverage off their systems and processes, is HFM: How have new regulations, such as the AIFMD, certainly the option that we are seeing. Strategic outsourc- changed the way administrators interact with the ing remains the practical option and as solutions are devel- hedge fund sector? oped for industry-wide issues, the cost can be controlled CM: I see two distinct components; the fi rst is the in- to a much greater extent than for a manager trying to wear creasing advisory relationship between administrator too many hats. and manager, where the broader industry exposure of our administration business allows us to provide an insight HFM: Looking ahead, are there any other future regu- into options which may not be immediately apparent to latory developments that are causing you concern? a manager trying to address particular issues in a vacuum. CM: Unfortunately, I don’t think we are over the Fatca Th e second is the manager/client-driven expansion of out- hump yet. Th e geopolitical drive towards a common re- sourced back and middle offi ce services off ered by admin- porting standard off ers a solution of sorts, but the reality istrators. At Elian, we have seen within our private equity of the modern world is that CRS is viewed as a standard business in particular a growing demand for additional until it comes to passing domestic enforcement legislation regulatory and operational controls and support services when every jurisdiction wants to att ach its own emphasis to new and existing managers and funds to help meet the or bolt on additional information requirements. From an increasing regulatory and statutory obligations. operational perspective, a genuine CRS would be prefer- able – one standard of data gathering and reporting across HFM: Are you seeing any new trends from the hedge multiple jurisdictions, which is easy to understand and fund clients you are dealing with in terms of the juris- easy to implement. However, the danger is that jurisdic- dictions being used and type of strategies being off ered? tional drift will make it harder than it should or could be. CM: Domiciling and structuring remains consistent with How we anticipate that and provide a solution to clients is the traditional onshore/off shore, Delaware/Cayman what keeps me awake at the moment. Q

9-15 OCT 2014 HFMWEEK.COM 29 FEATURE ASIA SERVICES AWARDS 2014

ASIA 2014 HEDGE FUND SERVICES AWARDS

Last month’s HFMWeek Asia Service Awards recognised the providers and vendors who were providing top-notch levels of service to hedge fund managers in the region. Here are all the award winners in each of our service categories, who were presented with their gongs at a ceremony held at the Conrad Hotel in Hong Kong. Congratulations to everyone featured on this page and to all the firms that were nominated for these prestigious awards.

BEST ADMINISTRATOR BEST ADMINISTRATOR BEST ADMINISTRATOR BEST ADMINISTRATOR UNDER $30BN – SINGLE UNDER $30BN – FUND OF UNDER $30BN – OVERALL OVER $30BN – SINGLE MANAGER HEDGE FUNDS MANAGER

BEST ADMINISTRATOR BEST ADMINISTRATOR BEST ADMINISTRATOR BEST ADMINISTRATOR OVER $30BN – FUND OF OVER $30BN – OVERALL MIDDLE-OFFICE SERVICES SMALL AND START-UP HEDGE FUNDS FIRMS

30 HFMWEEK.COM 9-15 OCT 2014 BEST AUDIT SERVICES BEST TAX ADVISORY BEST TECHNOLOGY BEST TECHNOLOGY PROVIDER - OVERALL PROVIDER - INNVOATION

BEST ADVISORY FIRM BEST ADVISORY FIRM BEST HEDGE FUND BEST OFFSHORE LAW FIRM - CLIENT SERVICE - REGULATION AND PLATFORM COMPLIANCE

BEST ONSHORE LAW FIRM BEST OFFSHORE LAW BEST ONSHORE LAW BEST PRIME BROKER FIRM - CLIENT SERVICE FIRM - CLIENT SERVICE TECHNOLOGY

BEST PRIME BROKER BEST PRIME BROKER BEST PRIME BROKER BEST OVERALL PRIME - INNOVATION - CAPITAL INTRODUCTION - CONSULTING SERVICES BROKER

9-15 OCT 2014 HFMWEEK.COM 31 HFM FOCUS DEPTH OF EXPERTISE AND KNOWLEDGE

FOCUS ON BACKTESTING IS AN EXCELLENT WAY TO SEE WHETHER THE VALUE DRIVERS IN THE FUND’S MODELS WHAT DID WE (CASH FLOWS, EXIT MULTIPLES, LEARN? DISCOUNT RATES, CAP RATES) MATCH THE ASSUMPTIONS

Mark Shayne, of Empire Valuation, speaks to HFMWeek about the key AND VALUE DETERMINANTS OF issues being discussed by industry leaders and the challenges these RELEVANT MARKET PARTICIPANTS bring to valuation fi rms

f you root for the NY Mets and care enough to lis- one’s” own account, client asset protection or valuation. In- ten to their radio broadcasts (admitt edly, a small vestors want to know that reported asset values equate to pool), the glass is half full and half empty. Half asset fair values. Transparency, both internally and exter- empty because the Mets have been underachiev- nally, is becoming more important as regulation continues ers since 2006, and even more unforgivably, gen- to creep into more segments of the industry. Large inves- erally boring; half full because Howie Rose and tors are calling for transparency as a requirement for them JoshI Lewin are among the best announcers in baseball. to invest (a change for private equity funds in particular). Aft er each game, Josh Lewin has a segment, ‘What Did We Th is is critical not only for regulators and investors, but for Learn?’ In the spirit of Josh’s post-mortems, let’s see what performance assessment, benchmarking, and to ensure we have learned recently. that asset managers are appropriately compensated based Mark Shayne is a Conference agendas, media posts and client due dili- upon actual, not aspirational, returns. managing director with gence discussions oft en represent a barometer of the con- We have been the subject of ODD reviews by funds Empire Valuation Consult- cerns that market participants face. Consistently, recent of funds interested in the performance of their investee ants, LLC. He has over 25 hedge fund agendas, posts and discussions have coalesced hedge funds and other clients. We have discussed valua- years of valuation experi- around the following issues: tion philosophy, market expectations and methodologies ence with hedge funds, ; Fatca with our clients. We have also heard from countless mar- alternative investments ; Management fees ket participants about transparency. What role can third- and private equity/debit ; Transparency party valuation fi rms play in providing transparency? fair value measurement. ; ODD (Operational Due Diligence) Generally, valuation issues surrounding level one and Shayne received a BS ; Valuation and compliance level two assets are straightforward. Valuation issues be- Degree cum Laude from come more complex when dealing with level three assets, Wharton and MBA with For this article, we leave the Fatca and management fee where there is no liquid market for a security and no (or Distinction from NYU. discussions to others, but the other three issues are a regu- an insuffi cient pool of) secondary market trades or broker lar concern we see and deal with. Empire has the good for- quotes. Independent, third-party valuations or confi rma- tune to work with some of the top hedge funds and most tions can provide the sought-aft er assurance and transpar- astute alternative investment managers in the industry. ency to investors and regulators. Th is work allows investors As a result, we interact with and learn from some of the to see, on a much more granular level, how asset values are brightest people focusing on these issues. arrived at, in some cases, or closely reviewed in others. Market participants, investors and regulatory authori- Illiquid securities present special challenges to the as- ties want to be sure that ‘what you see is what you get’, sessor of fair value. Access to information, particularly on whether in marketing materials, compensation, trading for co-investment positions, unobservable inputs, complex promote arrangements and tight fi nancial reporting dead- lines all create challenges in assessing the fair value of level three investments on a timely basis. EMPIRE HAS THE GOOD FORTUNE TO WORK WITH What practices can the valuator use to mitigate these valuation and reporting challenges? First, commit to SOME OF THE TOP HEDGE FUNDS AND MOST working closely with the client fund to understand the un- derlying rationale for what made the investment att ractive ASTUTE ALTERNATIVE INVESTMENT MANAGERS IN for acquisition. Read the investment memoranda, both in- THE INDUSTRY. AS A RESULT, WE INTERACT WITH itial documents and subsequently modifi ed ones. Test the fund’s underlying fi nancial investment model for the asset. AND LEARN FROM SOME OF THE BRIGHTEST PEOPLE Speak directly with asset managers and servicers. Com- pare model assumptions with market participant inputs FOCUSING ON THESE ISSUES and outputs. Track ongoing, real-time performance with prior forecasts. We also like post-transaction backtesting of model assumption inputs and concluded values or out- ”32 HFMWEEK.COM 9-15 OCT 2014 SPONSORED FEATURE

puts. Backtesting is an excellent way to see whether the value drivers in the fund’s models (cash flows, exit mul- tiples, discount rates, cap rates) match the assumptions FUNDS ARE PAYING THIRD-PARTY VALUATION and value determinants of relevant market participants. Finally, remain acutely aware of financial filing deadlines, FIRMS TO CONFIRM OR VALUE THEIR LEVEL THREE fund administrator reporting commitments and audit re- view timetables. INVESTMENTS ANYWAY, SO PUTTING THEM TO WORK Compliance is at the forefront of a manager’s concerns, and rightly so, especially for the valuation function. Nev- IN OTHER WAYS MAKES SENSE ertheless, one outgrowth of the implementation of the valuation process could be the evolution of the third-party valuation agent from fulfilling only a compliance/regula- tory function to assisting fund management as value-add- ed experts, whose views shed (additional) light on how ” tion review and reporting process across funds eases re- markets might view hard-to-value investments. Funds are turn comparisons and administrative burdens. It makes paying third-party valuation firms to confirm or value their sense to take advantage of the breadth of experience that level three investments anyway, so putting them to work in the third-party valuator offers by working with multiple other ways makes sense. funds and fund manager styles, structures and asset class- Fund management is always looking for an incremen- es, to bring potentially new best practices into one’s own tal edge to boost performance and investor relations. fund, or help expand these practices consistently across Moreover, improving internal conformity in the valua- funds. Q

9-15 OCT 2014 HFMWEEK.COM 33

SERVICES DIRECTORY To promote your company, email: [email protected] or call UK +44 (0)20 7832 6615 // US +1 (212) 268 4919

Canover Watson, Managing Director – Admiral based in Cayman // T: +1 345 949 0704 // [email protected], Ted Jasinski, General Manager – Admiral based in Virginia // T: +1 804 578 4540 // [email protected] // www.admiraladmin.com

Admiral Administration is a specialist hedge fund administrator founded in 1996. Admiral is part of the Maitland Group, a global institutional provider of fund administration and multi-jurisdictional legal, tax, fiduciary and investment advisory services. The group has US$200 billion under administration and 700+ employees servicing clients from 13 offices across 12 countries. Whether your fund trades equities, options, futures, bonds, bank debt, or complex derivatives, Admiral has an efficient solution to account for the security and customized reporting to match your needs.

Thalius Hecksher, Global Managing Director of Business Development // T:+1 (786) 8771923 // [email protected] Peter Hughes, CEO and Founder / T:+44 (0) 778 0997609 // [email protected] Apex Fund Services was established in 2003, and is now one of the world’s largest independent fund administration companies with 34 offices and $26bn AUA. The Apex Global Network is at the heart of the Company’s strategy of being located alongside its clients providing the highest levels of personalized fund services based on four core pillars: Fund Administration, Fund Launch Solutions, Financial Outsourcing and Technologies, providing a full suite of services for our clients. Apex is unique in its ability to Reach Globally, Service Locally and provide best practice cross-jurisdictional solutions enabling a straight through process with complete integration.

Mark Catalano, Head of Business Development // 17310 Red Hill Ave, Suite 135, Irvine, CA 92614 // T: +1 760 889 1225 // mcatalano@atlasfundservices. com // April Spencer, Vice President // 3440 Torringdon Way, Suite 205, Chartlotte, NC 28277 // T: +1 980 265 2367 // [email protected] // Danique Sprock, Managing Director // Ara Hill Buildiing, Pletterijweg Oost 1, Willemstad, Curacao // T: (599-9) 845-3286 // [email protected] Atlas Fund Services (“ATLAS”) provides complete fund service solutions. Atlas is a privately held, fully licensed, recognised global fund services provider, de- livering tailored hedge fund administration solutions to alternative investment funds including private equity, real estate funds, venture capital funds, hedge funds, and managed accounts. ATLAS is the synergistic partner and preferred incubator of one the world’s largest fund administrators, delivering premium fund service solutions to investment managers located in the United States, Latin America, Brazil, Europe, and Asia, and servicing US onshore funds, and funds in offshore jurisdictions such as the Cayman Islands, the BVI, and Bermuda. The firm has regional offices in Charlotte, North Carolina, Curacao, and soon Malta.

Andrew Dougherty, Managing Director and Head of Alternative and Institutional Solutions - Securities Services North America // T: +1 212 841 2843 BNP Paribas is a leading global provider of securities services that delivers integrated solutions for all participants in the investment cycle: sell side, buy side and issuers. With a local presence in 32 countries across 5 continents and a global coverage of over 100 markets, we work by our clients' side around the world, offering a one-stop shop for all asset classes, both onshore and offshore. In the alternative investment industry, BNP Paribas is well-regarded for the level of thought leadership and service excellence expected from one of the world’s largest and strongest banking groups*. Thanks to our continual investment in technology, people, and product development, we deliver innovative, operationally efficient solutions that operate across the entire value chain for single hedge funds, funds of hedge funds, and separately managed accounts. *Rated AA- by Standard and Poor's.

Marina Lewin, Head of Global Business Development, Asset Servicing // T: +1 212 815 6973 // [email protected] Mark Mannion, Head of EMEA Business Development, Alternative Investment Services // T: +353 1 900 4547 // [email protected] BNY Mellon is a global investments company dedicated to helping its clients manage and service their financial assets throughout the investment lifecycle. Whether providing financial services for institutions, corporations or individual investors, BNY Mellon delivers informed investment management and invest- ment services in 35 countries and more than 100 markets. BNY Mellon can act as a single point of contact for clients looking to create, trade, hold, manage, service, distribute or restructure investments. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation (NYSE: BK). Additional information is available on www.bnymellon.com, or follow us on Twitter @BNYMellon.

CACEIS // Paddy Walsh, Business Development Director – UK & Ireland // UK Tel: + 44 20 7214 5053 // email: [email protected] // www.caceis.com CACEIS is an asset servicing banking group dedicated to institutional and corporate clients. Through offices across Europe, North America and Asia, CACEIS offers a broad range of services covering depositary and custody, fund administration, alternative investment servicing, middle-office outsourcing, derivatives clearing, forex, securities lending, and fund distribution support. CACEIS is a leading player in the alternative investment servicing market, and with assets under custody of €2.3 trillion and assets under administration of €1.3 trillion, CACEIS is one of the leading global asset servicing providers and the largest depositary and premier fund administrator in Europe (figures to 31 December 2013).

Gerben Oldekamp // T: +31 (0)334673898 // [email protected] // www.circlepartners.com // Circle Partners, Utrechtseweg 31D, 3811 NA Amersfoort, The Netherlands.

Circle Partners is a financial services organisation specialised in rendering accounting and administration, shareholder and organisational services to investment funds established in a different number of jurisdictions and with diverse investment strategies. Our goal is to assist asset managers in building their invest- ment fund and enabling them to concentrate on the asset management business through a process of outsourcing virtually all back-office functions to Circle Partners. Special care and attention is given to accurate and swift communication with the fund manager and shareholders to enhance client satisfaction and confidence and to assist in creating a sound reputation for the fund.

Rod White, Director, Bermuda and North America // [email protected], Alan McKenna, Director, Europe // amckenna@equinoxeais. com, Irfaan Hossany, Director, Mauritius and Africa// [email protected], Liam McHugh, Director, Asia // [email protected]

Equinoxe is a premium boutique service provider founded in 2007 by experienced hedge fund administration professionals. Headquartered in Bermuda, with operational offices in Bermuda, Ireland, US, Mauritius, Malta and Singapore, we are a full service alternative investment fund administration organization offer- ing both traditional hedge fund administration and middle office outsource products. With institutional technology, institutional procedures, including a SOC 1 report across all offices, the 150+ funds under administration experience ultimate client service via a bespoke operating model tailored to each clients needs.

Michael Keyrouz // T: +356 2258 9502 // [email protected] Ian Hamiltion // T: +27 21 402 1600 // [email protected] // 276 Fleur-de-Lys Road, Birkirkara, BKR 9067 Malta

IDS Fund Services Malta is part of the IDS Group, the leading African Alternative Investment Administration Group. IDS Malta is regulated by the Malta Financial Services Authority, having opened on the island in April 2010. The company serves funds domiciled in Malta as well as other international domiciles. The company is also affiliated with a number of platforms, providing tailored and inexpensive hosting facilities for start-up and smaller Malta and Cayman-based funds. IDS Group has become a leading fund administrator through listening to its clients and providing tailored solutions and services. FUND ADMINISTRATORS

9-15 OCT 2014 HFMWEEK.COM 35 In the future, finance will help new growth flourish.

There are grounds for cautious optimism in the real economy — but creating sustainable growth always needs careful encouragement.

New income streams should be built on opportunities that have longevity and new solutions prepared for technology that will continue to evolve.

In this era of transparency, HSBC is working with clients to help create conditions in which businesses can flourish.

By connecting the developed and the developing world, we can help you protect and cultivate real growth — and so create success that lasts.

There’s more on the future of finance at www.hsbcnet.com/growth

HSBC operates in various jurisdictions through its affiliates, including, but not limited to, HSBC Bank plc who is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, The Hongkong and Shanghai Banking Corporation Limited, HSBC Securities (USA) Inc., member of NYSE, FINRA and SIPC, and HSBC Bank USA, NA.

Issued by HSBC Holdings plc. AC22067 SERVICES DIRECTORY To promote your company, email: [email protected] or call UK +44 (0)20 7832 6615 // US +1 (212) 268 4919

Steve Slessor, Managing Director, Global Head of Sales // T: +1 519 748 6028 x140 // [email protected] Blair Henderson, Managing Director, Business Development // T: +44 0 203 195 0336 // [email protected]

Mitsubishi UFJ Fund Services is part of the fi fth largest bank in the world with $2.4tn in assets and over 140,000 employees worldwide. Mitsubishi UFJ Fund Services provides a multi product offering that suits clients’ specifi c needs – leveraging the fi nancial and intellectual capital of Mitsubishi UFJ Financial Group. From fund administration, custody, FX hedging, trust, depositary to securities lending and other banking services, Mitsubishi UFJ Fund Services partners with clients throughout the trade lifecycle. Mitsubishi UFJ Fund Services has $165bn in AuA, servicing 1000 funds globally.

Robin Bedford, CEO // [email protected] // (441) 234-0004 // Stephen Giannone, President & Head of Sales // sgiannone@ opusfundservices.com // (312) 374-1614 // Greg Knapp, Business Development // [email protected] // (415) 762-8749 // Jorge Hendrickson, Business Development // [email protected] // (646) 439-7004

Opus Fund Services is an award winning independent fund administration fi rm. Within a SSAE16 approved process, Opus uses unique technology and fl at fee pricing to provide automated, integrated middle & back offi ce administration services to domestic and offshore hedge fund and alternative investment vehicles. The ONE platform has received widespread industry recognition including “Best Overall Fund Administrator with AuA < $30bn” by HFMWeek, and Top-Ranked Fund Administra- tor by Global Custodian for an unprecedented fi ve consecutive years. For more information on Opus Fund Services, please visit www.opusfundservices.com.

Asia: Gillian Chan // T: +852 2295 2968 // gillian.chan@orangefi eld.com Europe: Sean Murray // T: +352 (49) 6767 4417 // sean.murray@orangefi eld.com www.orangefi eld.com

For 40 years across our 25 global locations, Orangefi eld has been providing exceptional alternative investment fund services. Our full suite of services includes administration, set-ups and back / middle offi ce outsourcing as well as corporate, director and trust services along with regulatory compliance. Orangefi eld employs an expert consultative approach to create solutions unique to the client and believes that investing in exceptional technology to meet higher stan- dards allows our clients to succeed. We follow this principle of mutual growth throughout the entire fund life cycle.

Ken Somerville // Head of Business Development // [email protected] // T: +353 1 523 8003 // www.quintillion.com Joan Kehoe // Chief Executive Offi cer // [email protected] // T: +353 1 523 8001 // www.quintillion.com

Quintillion is a specialist Dublin based provider of fund administration to alternative investment funds. We provide back and middle offi ce services to a diverse range of fund structures, strategies and domiciles supported by class leading technologies and our expert operations group. Following our start-up or conversion process, funds are serviced by client-centric investor services and accounting teams delivering an accurate, timely and transparent administration solution all within strict deadlines.

Punit Satsangi, EMEA Managing Director // [email protected] // T: +44 (0)20 3310 3304 1 St. Martins Le Grand, London, EC1A 4AS // www.sscglobeop.com SS&C GlobeOp, a division of SS&C Technologies, is an independent top-10 fund administrator for both onshore and offshore hedge funds. Key differentia- tors for our business include our cutting-edge cloud-based services which allow unparalleled transparency and access for investors, regulators and clients alike; our high quality custom service model; our signifi cant staff expertise and propriety ownership of state of the art technology. Our growth and success is driven by high quality service, satisfi ed customers and referrals. SS&C GlobeOp serve over 6,700 funds representing $430bn in AUA ranging from start-up funds to some of the biggest names in the industry.

Karine Seguin, Head of Business Development – Europe // T: + 44 (0)207 935 1503 // [email protected] Dan Smith, Head of Business Development – North America // Tel: +1 (404) 364 2068

Trident Fund Services, a division of the Trident Trust Group, provides cost-effective fund representation and administration services across ten jurisdictions in the Caribbean, North America, Europe and Asia. Serving more than 325 funds with AuM exceeding $30bn, managers select us for our independence, pricing based on services performed and not AuM, global footprint, experienced personnel, reliability and responsiveness. We offer clients a more than 30-year track record as a leading provider of administration services to the fi nancial services sector worldwide. Visit us at www.tridentfundservices.com

Concetta Mastrangelo, Fund Services Business Development, USA // T: +1 212 719 2178 // [email protected] James Gilbert, Fund Services Business Development & CRM, Cayman Islands // T: +1 345 914 6150 // [email protected]

UBS's Fund Services business is a global fund administrator providing professional services for traditional investment funds, managed accounts, hedge funds, private equity funds and other alternative structures. With service centers located in Canada, Cayman Islands, Ireland, Jersey, Luxembourg, Singapore, Switzerland and the United States together with business development and client service offi ces located in Hong Kong and the , Fund Services is dedicated to providing a comprehensive range of asset services to clients around the globe. For more information, visit www.ubs.com/fundservices

Tony Fischer, President // Tel: +1 267-349-8065 // www.umbfs.com

The Alternative Investment Services division of UMB Fund Services offers a complete back-offi ce solution for hedge funds, funds of funds, registered hedge funds and private equity funds. Our full-service lineup includes product formation assistance, fund administration and accounting, investor accounting and reporting, tax preparation and reporting, and custody (through our affi liate, UMB Bank, n.a.). We are known for high-touch service, leading-edge technology, and the stability of a highly capitalized parent that’s been around for 100+ years. Ask us about Registered Fund Solutions, the industry’s fi rst turnkey solution for launching and servicing a registered hedge fund.

Bob Kern T:+1 800 300 3863 // [email protected] // 615 East Michigan St. Milwaukee, WI 53202 // www.usbfs.com Since 1969, clients have come to rely on US Bancorp Fund Services for innovative service solutions and industry expertise. US Bancorp Fund Services has built its reputation on offering the broadest range of top-quality mutual fund and alternative investment product services. The expertise of US Bancorp Fund Services extends from mutual funds to a wide variety of alternative investment product services, including hedge funds, funds of funds, limited partnerships, offshore funds, private equity funds and separately managed accounts. With specialist expertise in both single manager and fund of hedge fund administra- tion, services can be provided for both onshore and offshore funds. Through our comprehensive range of services and products, leading edge technology platforms and superior client service, we work in partnership to offer the solutions you need. FUND ADMINISTRATORS

9-15 OCT 2014 HFMWEEK.COM 37 SERVICES DIRECTORY

International Management Services Ltd. Geoff Ruddick, Head of Funds // T: +1 (345) 814 2872 // Gary Butler, Managing Director // T: +1 (345) 814 2874 // [email protected] // www.ims.ky

International Management Services Ltd was one of the fi rst in Cayman to specialise in providing professional independent directors to the fund industry. IMS Today, we are a leading provider of corporate governance and associated services to the fund industry. All of our fi duciaries are registered with the Cayman Islands Monetary Authority as ‘Professional Directors’. Our team has over 200 years of collective experience in the fund industry and provides services to some of the largest global hedge fund organizations. We are one of the largest and longest standing truly independent providers of such services. INDEPENDENT DIRECTORS

LMAX Exchange LMAX Exchange, Yellow Building, 1A Nicholas Road, London, W11 4AN, Institutional Sales // T: +44 20 3192 2682 // F: +44 20 3192 2572 // [email protected]

The award-winning LMAX Exchange is the fi rst MTF for FX authorised and regulated by the FCA – delivering the benefi ts of limit-order driven, exchange quality execution, pre and post-trade transparency, 4ms trade execution speeds in 66 FX pairs and no ‘last look’ to the institutional FX market – all via multiple connectivity options: FIX 4.4, Java and .Net APIs, MT4/5 bridges. LMAX Exchange – a unique vision for global FX. LMAX Limited operates a multilateral trading facility. Authorised and regulated by the FCA – registered no. 509778 EXECUTION EXECUTION VENUE

Christian Bekmessian // T: +1 212 891 4062 // [email protected]; Peter Cogan // T: +1 212 891 4047 // [email protected]

EisnerAmper LLP is a premier full-service accounting, tax and administration fi rm with global capabilities. EisnerAmper has led the way in establishing and building a highly trained and dedicated Hedge Fund Group. Our professionals have experience and expertise in the intricacies of the regulatory and tax environment, the valuation of complex fi nancial instruments and the challenges of maintaining strong accounting and investment controls. The professionals of EisnerAmper have a decades-long service record to the fi nancial services industry, giving us an understanding of the problems you face on a daily basis, as well as the ability to provide practical solutions. www.eisneramper.com

Alan D. Alzfan, Partner, Financial Services Practice - North America // T: +1 212-372-1380 // [email protected] Simon Lesser, Financial Services Practice - North America // T: +1 312 634 4604 // [email protected] With more than 50 years of experience serving the fi nancial services community in key fi nancial hubs, McGladrey professionals help organizations navigate complex reporting, governance and regulatory issues to achieve their business objectives. Based on the knowledge that comes from serving alterna- tive investment companies, investment advisors, investment partnerships/hedge funds, private equity funds, business development companies, mutual funds, broker-dealers and futures commission merchants, we understand the complex operational, fi nancial reporting and compliance issues facing the industry. We provide industry insight, advice and solutions to fi nancial services organizations across the country and around the world. That’s what you can ACCOUNTING, TAX TAX ACCOUNTING, & ADMINISTRATION

Michelle Carroll, partner, Asset Management & Funds // T: +44 (0)20 7893 2711 // [email protected] // Neil Griggs, partner, Hedge Funds // T: +44 (0)20 7893 3775 // [email protected] // BDO LLP // 55 , London // T: +44 (0)20 7486 5888 // www.bdo.uk.com

BDO is the world’s fi fth largest accountancy and professional services fi rm, with nearly 49,000 partners and staff across 119 countries, including all major fi nancial centres. We have a strong reputation as a leading advisor to fi nancial services fi rms with a particular emphasis on the asset management sector. We have a dedicated global team and a multidisciplinary approach combining strategy, regulation, risk, tax, corporate fi nance and IT specialists.

David Jarman, Partner //T: +44 (0)20 7556 1262 // [email protected] // Peter Chapman, Partner // T: +44 (0)20 7556 1415 // [email protected] Buzzacott LLP // 130 Wood Street, London, EC2V 6DL // [email protected] // www.buzzacott.co.uk

Buzzacott is a London based accountancy fi rm with a specialist team offering audit, accounting and taxation services to the hedge fund sector. Buzzacott is a market leader for the provision of start-up, HR, FCA reporting and business support services to UK and US managers and their stakeholders. Buzzacott's Expatriate Tax Team has over 60 tax advisers with UK and US tax qualifi cations and can provide the added compliance and advisory tax services to clients with US shareholders or employees. ACCOUNTANTS

Paul Mifsud, Managing Director // [email protected] // 101 TOWNSQUARE, Ix-Xatt ta’Qui-si-Sana, Sliema SLM 3112 T: (+356) 21 33 57 05 // www.sparkasse-bank-malta.com

Sparkasse Bank Malta plc forms part of the Austrian Savings Banks and the Erste Group Bank AG forming part of Austria’s largest banks. From Malta the bank provides private banking and fund custody solutions. As trained private bankers, the bank strives to deliver private, personal and tailored solutions to its fund customers by offering a seamless banking, execution, settlement and custody solution from one account. Fund custody is considered a core service at Sparkasse Bank Malta plc and the bank avoids all potential confl icts by focusing entirely on what it is they are truly hired to do i.e. – safekeeping, record keeping, monitoring and reporting. CUSTODIAN CUSTODIAN BANKING

Rosie Guest, Brand Development Manager // [email protected] // Robert Kelly, Senior Partner // [email protected] //T: +44 (0)207 529 2305 // 3rd fl oor, 4 Maddox Street, London, W1S 1QP Headquartered in London, Baronsmead is an independent, specialist risk consultant and broker providing fi nancial risks insurance, guidance and advice to the alternative investment management industry. Baronsmead provides managers and their funds with risk transfer protection from the legal, regulatory, operational and employment risks they face. We have a tried and tested product, and in recent years, have managed and settled around $20m of manager and fund claims in the UK, New York, Cayman Islands and BVI. Hands-on claims management is key, and for this reason we have our own insurance litiga- tion solicitor in-house. At Baronsmead we believe in doing what is right for our clients and maintaining those relationships through a quality service.

Lockton Financial Risks, The St Botolph Building, 138 , London EC3A 7AG Henry Keville, T: +44 (0)20 7933 2157 // [email protected] Lockton is the world’s largest privately owned, independent insurance broker, which means our focus is on our clients and our people rather than external analysts and institutional shareholders. Lockton truly has a global footprint with over 60 offi ces around the world and more than 4500 employees with more than 15,000 clients. Our award winning specialist division focus exclusively on the asset management industry and our clients range from the largest asset management fi rms in the world right down to numerous start up operations with each and every client receiving the very best service; our clients have a combined AUM of US$10trn. Call us to fi nd out why the team have the highest client retention rate of any other broker. INSURANCE BROKERS

38 HFMWEEK.COM 9-15 OCT 2014 To promote your company, email: [email protected] or call UK +44 (0)20 7832 6615 // US +1 (212) 268 4919

Rawden Leigh, Marsh FINPRO UK // [email protected] // T: +44 207 357 1209 James S. Obrien, Marsh FINPRO // [email protected] // T: +1 212 345 6432

Marsh is a global leader in insurance broking and risk management. We help clients succeed by defi ning, designing, and delivering innovative industry-specifi c solutions that help them effectively manage risk. We have approximately 27,000 colleagues working together to serve clients in more than 100 countries. Marsh is a wholly owned subsidiary of Marsh & McLennan Companies, a global professional services fi rm offering clients advice and solutions in the areas of risk, strategy, and human capital. Marsh & McLennan Companies has more than 54,000 employees worldwide and approximately $12bn in annual revenue. INSURANCE BROKERS

E Phillip Chapple, Executive Director // [email protected] // T: +44 (0) 203 170 8815

KB Associates is a boutique operational consulting fi rm with offi ces in Dublin, London, Luxembourg, Cayman and New York. KB Associates advises managers on operational issues relevant to the establishment and ongoing management of offshore investment funds. Services include tailored hedge fund and investment manager start-up services, preparation for investor due diligence (full review to identify potential issues combined with advice on meeting grow- ing investor due diligence standards) and re-domiciliation advisory services. ADVISORY

Jack D. Seibald, Managing Member, 1010 Franklin Avenue, Suite 303, Garden City, NY 11530 // Tel: +1 (516) 746 5718 // Mob: +1 516 359 7503 // email: [email protected] Concept Capital Markets, LLC offers comprehensive brokerage and related services that provide traditional and alternative investment managers with cus- tomisable and scalable solutions. We were built by former investment managers to serve hedge fund managers, managed account platforms, institutional investors, family offi ces, and registered investment advisers with turnkey solutions designed to free clients to focus on their core competencies. Our offering features world-class custody and clearing options, multi-asset class capabilities, leading execution and order management systems, a seasoned execution desk, a range of fi nancing options, a highly professional operations and customer support team, comprehensive portfolio reporting capabilities, and capital introduction.

Kevin M. LoPrimo, Managing Director – Head of Hedge Fund Services and Equity Finance // T: +44 (0)20 7399 9461 Julian Parker, CEO // T: +44 (0)20 7399 9450

Global Prime Partners Ltd is a prime broker providing a highly personalised specialist service to start up and emerging hedge funds, family offi ces, asset managers and professional traders, often overlooked and underserviced by large fi rms. Our integrated, proprietary technology platform, allows us to provide the right level of integration and reporting to meet each of our client’s needs. We provide start up consulting, trade execution, clearing, custody, margin fi nancing, stock lending and potentially introduction to capital.

Jerry Lees, Chairman, Linear Investments // T:+44 (0) 203 603 9801 // jleeslinearinvestment.com // Sales +44 (0) 203 603 9844 sales@ linearinvestment.com // US offi ce: T: +1 (212) 293 1836 // 800 Third Avenue, 39th Floor, New York, NY 10022 // www.linearinvestment.com

Linear Investments provides Mini-Prime brokerage, regulatory incubation and capital introduction services geared towards smaller/mid-size funds. With Linears’ aggregated PB relationships, we can provide attractive pricing for our clients. For Capital introduction, Linear provides investment via its B&L Seeder fund for seed/acceleration capital. In addition, Linear provides outsourced trading through its experienced trading team, encompassing a comprehensive Electronic Execution platform.

Craig Aronoff // T: +1 (646) 545 3859 // email: [email protected] Robert Morse // T: +1 (646) 545 3860 // email: [email protected]

Victor Securities provides technology-driven brokerage solutions to professional investors including hedge funds, RIAs, CTAs and proprietary trading fi rms. Our clients benefi t from real-time risk management tools, customizable reporting, choice of trading platforms, and a capital introduction team that focuses on facilitating mutually benefi cial relationships between managers and investors. PRIME BROKERAGE

Henry Bregstein, Global Co-Chair of Financial Services Practice // P: (212) 940-6615 // F: (212) 940-3808 // [email protected] Lance Zinman, Head of Chicago Financial Services Practice // P: (312) 902-5212 // F: (312) 577-4587 // [email protected] Katten advises many of the world’s premier domestic and offshore hedge funds, commodity pools, and other collective investment vehicles. Both fi rst-time and well-established sponsors come to Katten for guidance on the structuring, formation and documentation of hedge funds. We also advise private fund clients in corporate and fi nancing transactions, including leveraged buyouts, minority investments, public and private exit transactions, recapitalizations, restructurings, and fund formation. Katten attorneys help our investor clients optimize the terms of each investment and prioritize their goals within each fund’s unique framework. Our depth of experience representing both sponsors and investors positions us to respond quickly with practical solutions that move deals forward.

Josée Weydert, Managing Partner & Banking and Finance Partner // [email protected] // 2, rue Jean Bertholet, L-1233 Luxem- bourg, Grand Duchy of Luxembourg // T: +352 26 12 29 1 // F: +352 26 68 43 31 // www.nautadutilh.com NautaDutilh is an international law fi rm with offi ces in Amsterdam, Brussels, London, Luxembourg, New York and Rotterdam. With more than 400 lawyers, notaries and tax advisers, NautaDutilh is one of the largest law fi rms in the Benelux region. NautaDutilh Avocats Luxembourg is a full service business law fi rm. It provides high quality legal advice and services in banking & fi nance, corporate, capital markets & , insolvency, tax, investment funds as well as intellectual property and ICT. NautaDutilh Avocats Luxembourg is a recognised player in the Luxembourg legal market. With its 35 lawyers, it serves a wide range of institutional clients, mainly fi nancial institutions, asset managers, large and mid-sized corporates, private equity fi rms, funds sponsors and IT companies.

Kate Wormald // 103 Wigmore Street, London W1U 1QS // T: +44 (0)20 3693 6085

We are a highly respected specialist consultancy providing legal and regulatory services to hedge funds and investment managers. We provide dynamic and proactive assistance in negotiations of all trading documentation. As specialists we do not have the distractions of a wider portfolio and therefore offer, what we believe is, an unrivalled level of service and understanding in the hedge fund arena. As active participants in the hedge fund industry we are closely involved in key industry developments. We pride ourselves on working in the most commercial and effective ways that best fi t with our client’s strategies and objectives. LAW

9-15 OCT 2014 HFMWEEK.COM 39 SERVICES DIRECTORY

Bill Prew, CEO // T: 44 (0) 203 691 6327 // [email protected] // www.indosgroup.com Paul Whelan, Head of Depositary Services // T: 353 (53) 924 3861 // [email protected] // www.indosgroup.com INDOS Financial specialises in providing AIFMD Depositary-Lite services to offshore hedge funds. Under the AIFMD EU hedge fund managers marketing offshore HFs to European investors, as well as non-EU managers marketing to certain EU countries, need to comply with new depositary requirements. Managers need to appoint a firm such as INDOS to perform oversight over fund valuation, subscriptions and redemptions, compliance with laws, regulations and investment guidelines as well as cash flow monitoring and record keeping of other assets. INDOS is 100% independent and will work with most leading hedge fund administrators to perform arms-length oversight. INDOS is authorised by the Financial Conduct Authority as an Article 36 Custodian. DEPOSITARY DEPOSITARY SERVICES

Backstop Solutions // US: Patrick Rodgers, VP, Regional Sales Manager & Sales Development // T: +1 312-277-7701 // 233 S. Wacker Dr., Suite 3960, Chicago, IL 60606, USA // EU: Simon Johnson, Managing Director, EMEA // T: +44 (0) 203 764 7090 // 25 Berkeley Square, Berkeley Square, London, W1J 6HN, United Kingdom Backstop Solutions Group, LLC is an award-winning provider of innovative software solutions to hedge funds, funds of hedge funds, endowments, foundations, pensions, fund administrators, private equity firms and family offices throughout the United States, Europe and Asia. BSG was founded in 2003 with the goal of creating the industry’s first Software-as-a-Service platform designed to help firms in the alternative investment management industry operate efficiently, invest intelligently and communicate effectively. For more information about Backstop’s product offerings, contact us at: [email protected]

Capital Support Ltd, 3 Harbour Exchange Square, Docklands, London, E14 9GE // Nigel Brooks, Managing Partner // T:+44 (0)20 7458 1290// [email protected] // Carrie Saunderson, Head of Business Development // T:+44 (0)20 7458 1290 // [email protected] Capital Support is an award winning managed IT services and support provider. The Company specialises in implementing and supporting end-to-end solutions for a large portfolio of global finance sector customers. Based in London, Capital Support has grown steadily since forming in 2002. This successful growth has been fuelled by Capital Support’s commitment to innovation and exceptional customer service. The company ethos is to make IT simple for its customers, replac- ing the burden of high contact IT services with intelligently designed packaged solutions that span from consultancy, design and deployment all the way through to live support. Capital Support’s number one objective is to become the most trusted and respected managed IT services provider in the UK.

CYMBA Technologies Ltd, Holland House, 4 Bury Street, London EC3A 5AW // www.cymba-tech.com Karim Ali, partner & co-founder // [email protected] // T: +44 207 220 6561

CYMBA Technologies is a supplier of front office software solutions for the asset management, multi manager and hedge fund sectors across fund manage- ment trading, compliance and operations functions inclusive of 3rd party connectivity with prime brokers, custodians & administrators. The CYMBA Athena IMS provides multi-asset class asset allocation, portfolio management, decision support, order generation, algorithmic trading, real time profit and loss analysis, execution management and pre & post trade compliance functions to some of the largest investment organisations in the world.

Eze Castle Integration, Dean Hill, Executive Director // +44 (0)207 071 6802 Simon Eyre, Director of Service // +44 (0)207 071 6835 Interpark House, 7 Down Street, London, W1J 7AJ, email: www.eci.com Eze Castle Integration is the leading provider of IT solutions and private cloud services to more than 650 alternative investment firms worldwide, including more than 100 firms with $1 billion or more in assets under management. Since 1995, Eze Castle Integration has developed financial vertical-specific IT solutions including infrastructure design and management (both in our Eze Private Cloud and on premise), telecommunications, business continuity planning and disas- ter recovery, archiving, storage, and internet services. These solutions are complemented by a broad service organisation that delivers outsourced IT support, including a 24x7x365 help desk, project and technology management services, consulting services and more. Eze Castle has presence in major financial centres including 8 US offices, a Singapore office, and a Hong Kong office in addition to its London office.

Gravitas, 475 Park Avenue South, 32nd Floor, New York, NY 10016 Derek Huyser, Business Development // T: +1 312 509 4079 // [email protected]

Gravitas is a leading provider of co-sourcing solutions for technology, investment operations, risk and research support to the alternative investment and financial services industry. Founded in 1996, the company provides hedge funds, private equity funds and other alternative asset managers with unique and flexible co-sourced offerings for systems integration, technical support, software development, investment operations, risk analytics, investment research support and more. From co-sourcing and advisory through implementation, Gravitas designs creative solutions that give clients the operational freedom to

HedgeGuard Financial Software // Shona Lynch // T: +(44) 2037007320 Established in London and Paris, HedgeGuard Financial Software is the specialist software provider for hedge funds, family offices, asset managers and startups. HedgeGuard®, their front-to-back portfolio management software, is designed to provide accurate performance monitoring of all funds, from one single platform. It smoothes out the whole management chain, from order management, position keeping, risk management, compliance and reporting. Their clients have the possibility to add other components to HedgeGuard®: the middle-office outsourcing service, working as a natural extension of the fund management team, and the mobile office option, offering full database hosting on private cloud and secured remote access. Not just another software provider. Discover more here www.hedgeguard.com

Intralinks, Inc, www.intralinks.com/hedgefund // T: 1-866-INTRALINKS, +44 (0) 20 7549 5200

Intralinks Fundspace™ for hedge fund managers provides best-in-class tools to distribute information to investors securely, efficiently and confidently. From capital-raising to investor reporting, Fundspace provides a single, end-to-end solution to effectively engage with and meet the increasing demands of institutional investors. With over 25,000 endowments, foundations, pensions, consultants, and advisors accessing information from over 500 fund managers, Fundspace is the world’s leading communication platform for alternative investment. For more information, visit www.intralinks.com/hedgefund.

Ras Sipko, COO // T: +1 201 291 7747 Koger Inc, 12 Route 17 North Suite 111 Paramus, NJ 07652 // www.kogerusa.com // [email protected] Established in 1994, KOGER® is a leading provider of technology solutions to the fund administration and asset management industries. With offices in the United States, Ireland, Slovakia and Australia, KOGER® provides comprehensive technical support 24 hours a day during business days. KOGER® products include: NTAS®, a shareholder register and transfer agency system, ETASTM, a three-tier web application connecting authorized third-parties with NTAS®, GRID®, a middleware application that facilitates the STP of data in and out of NTAS®, IKAS®, a fund accounting platform, PTAS®, a share-registration system that meets the needs of conventional and alternative pension funds, and PENTAS®, a Private Equity fund administration application. TECHNOLOGY

40 HFMWEEK.COM 9-15 OCT 2014 To promote your company, email: [email protected] or call UK +44 (0)20 7832 6615 // US +1 (212) 268 4919

USA: Branden Jones, 800 Third Avenue, 39th Floor, New York, NY 10022 // T: +1 (212) 293-1836// [email protected]

Liquid Holdings Group is a cloud-based technology and managed services provider to the global hedge fund and active trading markets. We provide hedge funds and other asset managers with the best way to de-risk their business, enhance decision-making, improve transparency and ultimately put more money into their investors’ pockets. While our business is new, our technology has been used for over six years by the most demanding institutional portfolio managers and traders, and its adoption rate is strong with over 45 clients and growing. We are headquartered in New York with offices in Hoboken, Aventura and London.

Jim Serpi – London // T: +44 (0) 20 7821 4950 // [email protected], Andre Fundora – New York // +1 646 385 7554 // Suite 26, 2 Station Court, Imperial Wharf, London SW6 2PY // www.matscosolutions.com Matsco Solutions Group, established in 2002, is the trusted IT support partner for hundreds of hedge funds and alternative investment firms across Europe, the United States and Asia. Specialising in hedge fund technology, Matsco Solutions provide best-of-breed industry solutions to its clients including private cloud services, business continuity planning, specialist start-up services, technology design, support and monitoring, virtual CTO services and a 24/7 engi- neer staffed helpdesk. The company was co-founded by Patrick Ferrall and Jim Serpi, who bring a wealth of industry experience, and has offices in London, New York, Stamford, San Francisco Bay, Hong Kong, Singapore and Beijing.

James Pinnington, Head of Hedge Fund Sales // T: +44 (0)20 3320 5750 // [email protected] For more information about Misys Sophis products, please contact: [email protected] // www.misys.com

Misys Sophis has more than 25 years experience in providing fully integrated cross-asset portfolio and risk management solutions to the world's leading financial institutions. Sophis VALUE is Misys’ flagship system for alternative investment and provides a single solution for portfolio management, performance measurement, investment accounting, risk management, reporting, compliance and data management together with the required connectivity to third par- ties such as prime brokers, custodians and administrators, as well as trading (EMS/OMS), clearing and matching systems.

Netage Solutions, Inc., 400 Talcott Avenue, 3rd Floor, Watertown, MA 02472 // www.netagesolutions.com Andrew Nelson, Head of Hedge Fund Sales // Tel: 617 393 2368 // email: [email protected] Netage Solutions has been a premier provider of industry-specific CRM software and online reporting systems for the alternative assets industry since 1998, building a client base that includes hedge funds, funds of funds, private equity and venture capital firms, real estate investment firms, prime brokers, family offices, and institutional investors. Intuitive and highly configurable, Netage's flagship Dynamo™ Suite has improved the productivity of investor relations, marketing, and research teams worldwide. Deep industry experience, dedicated client service and a culture of continuous innovation has made Netage Solutions the vendor of choice for more than 275 of the world’s premier alternative investment firms. Collectively, our clients manage over $650 billion in assets. To learn more about Dynamo™, or to request a product demo, please contact us at [email protected].

netConsult Ltd, Level 3, 75 Wells Street, London W1T 3QH // www.netconsult.co.uk Richard McDonald, Director // T:+44 (0)20 71003310 // [email protected] // David Mansfield, Director // T:+44 (0)20 71003310 // dmansfi[email protected] Established in 2002, netConsult is an award winning provider of managed IT Services to the global alternative investment industry. We aim to provide a high level of technical expertise to our clients combined with a dedication to customer service. Our ethos is based upon designing secure IT platforms which are manageable over the long term. We are a trusted technology provider to a large portfolio of clients ranging from small start ups to large global funds. netConsult provides a bespoke service to its clients and provides a full suite of IT services including Cloud Services, Outsourced IT, BCP, Virtual CTO and IT Security.

Nirvana Solutions, Mark Donovick, Vice President - Marketing // 80 Broad Street, Suite 1808, New York, NY 10004 // Tel: +1 212 768 3410 // email: [email protected] // London: Tony Premi // [email protected] // +44 (0) 203 174 2342

Nirvana Solutions is a cloud-based financial technology company that provides outsourced portfolio management solutions to hedge funds, prime brokers, and fund administrators. Nirvana is headquartered in New York City, with offices in San Francisco, London, and Dehli. Investment managers need a reasonably priced, entry-level yet scalable system which enables them to minimize upfront capital outlay and concentrate on alpha generation instead of systems and data management. Nirvana consolidates and manages data across multiple asset classes, funds, accounts, traders, prime brokers and custodians in a single integrated platform to provide our clients with cloud-based OMS, PMS, risk management and reporting solutions.

Sentronex, Joe Sluys, CEO // +44 (0) 207 397 7400 // [email protected], 42 Southwark Street, London, SE1 1UN, www.sentronex.com

Delivering expert, outsourced IT services bespoke to London’s financial community, Sentronex is committed to providing the best of the following services: IT Support, Disaster Recovery, Financial IT Consultancy, Cloud Computing, Hosting and Connectivity. Sentronex’s rapid growth since launching in 2005 is down to a winning combination of specialist technical knowledge and the extensive, fully-managed facilities we offer including multiple Disaster Recovery sites and a state-of-the-art Data Centre. Sentronex looks after an impressive range of FCA regulated clients spanning both the buy and sell-side. With Sentronex, there is no such thing as a one-size-fits-all approach; every solution is tailored to meet the individual needs and requirements of each financial firm.

Solidfire, Grant Stephens // +44 (0) 7538 440722 // grant.stephens@solidfire.com, Martin Cooper // +44 (0) 7943 211 979 // martin.cooper@solidfire.com

SolidFire is the market leader in all-SSD storage systems designed for next generation data centers. Leveraging SolidFire’s all-flash architecture, with volume- level Quality-of-Service (QoS) controls, customers now can guarantee storage performance to thousands of applications within a shared infrastructure. Coupling this functionality with in-line data reduction techniques and system-wide automation results in substantial capital and operating cost savings relative to traditional storage systems.

Watson Wheatley Financial Systems, Duncan Wheatley, managing director // T:+44 (0)1608 649640 // [email protected] // www.watsonwheatley.com // Marston House, Cromwell Business Park, Chipping Norton, Oxfordshire, OX7 5SR

Watson Wheatley is a reconciliation software specialist with extensive knowledge of hedge fund operations. Its flagship product i-Recs was specifically de- signed for the hedge fund market having been originally developed for one of the largest alternatives managers in Europe. i-Recs has a unique accounting engine underpinning the product which enables fully integrated trade and cash reconciliations and has the ability to calculate total equity on margin traded instruments. Packaged with i-Recs is a powerful data aggregation tool allowing interface on-boarding in a fraction of the time of traditional solutions. WWFS

TECHNOLOGY offers a user-based pricing model with no up-front licence costs.

9-15 OCT 2014 HFMWEEK.COM 41 SERVICES DIRECTORY To promote your company, email: [email protected] or call UK +44 (0)20 7832 6615 // US +1 (212) 268 4919

Chris Apostolou, Director // +44 203 371 0889 // [email protected] // www.arbitrage-search.com Arbitrage Search specialises in macro for hedge funds and banks, please call to discuss

Darren Gordois & Peter Peacock // +44 (0) 20 3137 8140 // [email protected] or [email protected] // www.mondrian-alpha.com // 5 Buildings, London, EC2M 5NS

Mondrian Alpha Recruitment Solutions provides innovative human capital solutions & research, market intelligence and competitor analysis to our clients. Our hedge fund coverage includes: sales & marketing, trading & structuring and infrastructure (operations, fi nance, legal & compliance). We pride ourselves on delivering complete, targeted and fast execution across our product suite. Please call in or email us to discuss your requirements.

One Ten Associates 1 Berkeley Street, London, W1J 8DJ Contact: Mush Ali (ACA), Director // T: +44 (0)20 7016 9910 // [email protected] www.onetenassociates.com

One Ten Associates is a specialist recruitment fi rm that services the permanent and temporary needs of the alternative/fund management sector. Our consultants have been in this sector for over ten years and have the network to cover your strategic senior hires as well the junior to mid- senior needs. RECRUITMENT

Orb Employee Benefi ts // Contact: Geraint Williams, Director // T: 0845 0138709 // [email protected] // www.orb-eb.co.uk

Orb is a highly experienced team of workplace pension and employee benefi ts consultants, specialising in helping hedge funds and their service providers develop effective employee reward programmes. workplace pensions & auto-enrolment - healthcare & dental - life assurance & income protection - keyman & partnership protection - travel insurance Combining the knowledge you would expect from a large business with the personal approach of a smaller fi rm, we are committed to providing excellent client service. Don’t just take our word for it - 97% of our clients say we are extremely or very responsive. EMPLOYEE BENEFITS

David Ross, Global Head of Marketing // +1 732-318-7109 // [email protected] // Jonathan White, Business Development USA // +1 646-861-3409 // [email protected] // Ranjan Mishra, Business Development UK +44 (0)20 7016 9170 // [email protected] // Bangalore +91 80 30982200 // Mumbai +91 022 30952200 We support a full range of administration, middle offi ce and accounting services for investment managers. Tailored for each manager’s specifi c requirements, our Best Thinking and Best Practices help managers grow. We offer customized Straight Through Processing and integrate post-trade operations across virtually every asset class, currency, border, or structure you can imagine. Our deep operational and accounting expertise backed by state of art technology enables a high degree of control via automation in a 24 hour, 6 days a week global delivery model. The result is a new level of scalability and fl exibility to help you grow. SHADOW- ACCOUNTING

ACA Compliance Group (Europe) Ltd // 11 Berkeley Street, Mayfair, London, W1J 8DS // www.acacomplianceeurope.com Ron G Weekes, Chief Executive // T: +44 (0)20 7042 0500 // [email protected] Damon Zappacosta // 589 Eighth Avenue, 7th Floor New York, NY 10018, USA // T: +1 212 868 5940 ACA is the world’s largest independent compliance consultancy. Operating from 12 offi ces in America and Europe with a team of 140 – a third of which are former FSA, SEC or NFA (CFTC) regulators – ACA support over 700 clients including a third of the 100 largest hedge fund managers, four of the top fi ve PE fi rms, large retail and long-only managers, asset management institutions, Trusts, brokers and smaller boutiques. ACA in London includes ex-FSA and ex-SEC examiners – a unique offering in Europe.

Cordium // London (headquarters), NY, Boston, SF, HK // UK: Sarah Donnelly // T: +44 (0) 203 141 9658 // [email protected] // USA: Hannah Weinstock Gallagher // T: + 1 212 515 2800 // [email protected] // HK: Derek McGibney // T: +852 3478 7378 // [email protected] // www.cordium.com Cordium is the leading global provider of regulatory compliance consulting, accounting and tax services and software to the asset management and securi- ties industry. Today, Cordium has offi ces in London, New York, Boston, San Francisco, Malta and Hong Kong and employs more than 200 experienced profes- sionals who support more than 1,500 investment businesses. Our clients range from start-ups to large fi rms with well-established track records. Our asset management and securities sector focus means we always bring direct, relevant experience to advising our clients, helping them to meet their compliance and regulatory challenges and turning regulatory compliance into a must-have business advantage.

Robert Quinn // Managing Director // [email protected] // 42 Brook Street, London W1K 5DB // www.robertquinn.co.uk T: +44 (0)207 958 9127 Robert Quinn Consulting is a London-based premier fi nancial compliance consultancy. We specialise in integrated FCA and SEC compliance programmes and both UK and US fi nancial regulatory compliance to institutional and asset management clients worldwide. Robert Quinn Consulting was founded in 2007 with the goal of providing pragmatic guidance and responsive customer service to our clients. Our dedicated team allows us to be a focused resource contributing to your success. COMPLIANCE COMPLIANCE CONSULTANTS

ManagementPlus // Kavita Thomas, Manager // email: [email protected] // Tel: + 352 2747 4724

Operating from our strategic locations in Luxembourg, the Cayman Islands, Singapore, New York and London, we are a leading independent provider of fi duciary and oversight services to the international funds industry, well recognised by the institutional investor community. Core services include indepen- dent directors, UCITS and AIFM management company solutions and Luxembourg conducting persons. The independent directors are a panel of carefully selected, highly skilled directors from diverse and relevant backgrounds, available around the globe to suit clients' needs. GOVERNANCE

42 HFMWEEK.COM 9-15 OCT 2014 Providing the complete DNA infrastructure for funds

Peter Hughes Thalius Hecksher apexfundservices.com Group Managing Director Global Head of Business Development Tel: +44 7780 997609 Tel: +1 305 646 1086 [email protected] [email protected] © 2014 EYGM Limited. All Rights Reserved. ED none. . 3 December 2014 3 December Zurich 15 January 2015 San Francisco San 2014 13 November Shanghai 2014 5 December Singapore 2014 2 December 2014 20 November Toronto ey.com/hfsymposium London 2014 19 November Angeles Los 15 January 2015 Luxembourg 2015 March Minneapolis 2014 12 November York New 2014 5 November Dublin 20144 December Hong Kong 2014 3 December Global Hedge Fund Hedge Fund Global Series Symposium ey.com/hfsymposium Join us for our Global Hedge Fund Symposium Symposium our Global Hedge Fund Join us for K]ja]k$lYcaf_hdY[]afÕfYf[aYd[]fl]jk worldwide. around leaders industry senior convene We into and clarity insight you give globe to the fund hedge global the facing issues crucial the can show we are, you where No matter industry. future. a better to way the you LgÕf\gmlegj]$nakal Powerful insights. Leading trends. Endless opportunities. 19 November 2014 19 November Dallas 2014 11 December Cayman 2014 11 December Charlotte 3 December 2014 Chicago 19 November 2014 19 November Bermuda 2014 20 November Boston 2014 19 November Amsterdam