US hedge FoF uses ex-MLC exec for Aussie entry

California-based hedge fund manager Coast Asset Management has signaled an expansion of its reach into the Asian region, with a former senior MLC executive being used in the Australia push.

Coast, based in Santa Monica, manages about $US5.7 billion in a range of hedge fund of funds (FoF), structured products and complementary single-manager strategies. The firm has engaged John Gee, a former senior executive at MLC, who prior to that brought Massachusetts Financial Services to Australia, to assist, on a strategic consulting basis, in the Australian launch. Coast has a heritage in trading strategies dating back to 1991, under founder and president David Smith. In 1995 it branched out into hedge FoFs, which is now the largest part of the business. Coast opened its first international office in London in 2007 and has also recently appointed a strategic consultant in Japan, which Roger Hartley, the company’s chief operating officer, said showed strong prospects. Gee undertook a market-entry study for Coast in Australia earlier this year. Hartley said Coast wanted to make sure it understood what the local market was looking for. “It’s about researching the market and doing the right thing… Proper support is essential. We also want to make sure that people understand what we do. We tend to form close partnerships with our investors,” Hartley said. In its single-manager products, Coast runs some sophisticated arbitrage strategies, primarily in the government bond arbitrage sector. Coast’s flagship FoF product, a diversified FoF, typically has 40-60 underlying managers. Coast has 27 investment professionals out of a total staff of 93 and is registered as an Investment Adviser with US Securities and Exchange Commission.