This content is from: Portfolio

The Morning Brief: TCW Launches Alternative Mutual Fund

TCW Group announced Monday its first alternative mutual fund — the TCW | Gargoyle Hedged Value Fund — as well as the creation of a new family of alternative mutual funds. The Gargoyle fund, creatied in conjunction with Gargoyle Investment Advisor, will buy undervalued stocks and sell overpriced index call options, according to a press release. The fund has already been functioning for three years as a mutual fund and has so far outperformed the Standard & Poor’s 500 index by an average of 4.6 percent each year.

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It’s anybody’s guess whether hedge funds with holdings in Puerto Rican debt will see their money again, according to a report in Pensions & Investments. Hedge funds own about one-third of Puerto Rico’s outstanding $72 billion in debt, which the commonwealth has said it will be unable to repay. An analyst told P&I Monday that “there are too many moving parts” to know just how Puerto Rico will adjust its capital structure and whether hedge funds (and mutual funds and retail investors) will be left in the lurch.

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Zentific Investment Management has launched a flagship Asia-focused fund. Zentific, which was started in December by alums of BlackRock, Macquarie and Millennium Management, has a pan-Asian market neutral systematic quant strategy. The new fund is reportedly launching with about $100 million, making it one of the largest new entries in recent months.

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Brevan Howard Asset Management is reversing an eariler decision to move its offices out of London and relocating some senior traders from Geneva back to the City, according to the Financial Times. Many hedge funds had moved to Switzerland, lured by a better tax environment, but that wasn’t enough to keep them permanently away from London, it seems. Some saw the initial exodus as a gloomy omen for London as a financial center, but the FT reports that with Brevan Howard moving back and new launches including Everett Capital Advisors and Brevan Howard founding partner Chris Rokos’s Rokos Capital Management setting up shop there, the City’s position will likely be safe—for now.

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In response to turmoil in Chinese stock markets, Singapore-based APS Asset Management has halted trading and investment related to its APS Greater China Long/Short Fund, the firm said in a filing Monday. The fund manages about $85 million and saw striking gains of about 70 percent this year until Chinese equities turned south in June. In the last few weeks, Chinese regulators have cut interest rates, blocked initial public offerings and taken other measures that APS says have created unattractive conditions for its China fund. One of the biggest issues is the fact that more than a thousand Chinese companies have stopped providing share information.

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