FRM Capital Advisors seeds Japan focused hedge fund
30 January 2013
FCA will make a significant investment in a fund launched by Arena Capital Management Limited (“Arena”), a Hong Kong based investment advisor.
Arena, established in May 2012 by Toby Bartlett (CIO), manages a Japanese Long-Short Equity strategy focusing on domestic demand sectors, constructed with a factor neutral pair trading book. Joining Mr Bartlett at Arena are Greg McLaughlin (COO), Ayumu Kuroda (Head of Trading and Risk Systems) and Yukimi Oda (Research Analyst).
Patric de Gentile Williams, Head of Seeding at FRM said:
“This deal reinforces the global nature of FCA as a seeding business and is the first investment we have made since FRM was acquired by Man last year. We view Asia, and specifically Japan, as an important focus in our manager research, where we have a local office and a significant investor base.
“Arena’s focus is on the Japanese domestic demand sector and Toby has demonstrated experience in researching and investing in this space from his time at Highbridge, Citadel and Fidelity Investments Japan. We see this both as an opportunity to potentially generate alpha in what is traditionally a less researched market by hedge funds where we have seen greater inefficiencies that allow managers that do in depth analysis to seek an edge, and as an opportunity to attract assets from investors looking to allocate to pure Japanese Long-Short Equity funds.
“In addition, the recent drop in the Yen and newly elected Prime Minister Abe’s growth focused economic strategy has caused a noticeable rally in the domestic market that may spur meaningful investor interest.
“Toby has demonstrated his ability to run a successful portfolio within a robust risk management framework and with FCA’s support we believe he will be able to build an alternative investment management business that benefits his investors, his team and FCA’s investors.”
Toby Bartlett, CIO of Arena, said:
“As a new hedge fund, this major investment by FCA allows us to focus all our energies on operational excellence and generating high quality returns for our investors.
“Our focused approach to fundamental research in Japanese equities, combined with disciplined portfolio construction and risk management, allows us to pursue our goal to have low correlation to markets and protect against downside volatility whilst capitalizing on market opportunities for our investors.
“This strategic relationship with FCA is a major endorsement of the investment process and business principles of Arena.”
Arena is the first seeding deal announced by FCA since FRM was acquired by Man in July 2012 and combined with its multi-manager business to create the largest independent European based fund of hedge funds group.
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