BT Investment Management (BTIM) has shelved plans for an Asian equity quant product because it could not secure prime broking at realistic prices, leading to the departure of an executive who’d been investigating the business, but the manager will hire two people as it commercialises its multi-strategy Total Return Fund.
Matthew Hook, a PhD in aerospace engineering and pairs trading expert who transferred to BTIM from its aborted Voyager boutique, has left after the manager decided against pursuing an Asian strategy internally.
BTIM’s general manager, Dirk Morris, said a combination of shorting bans in some Asian territories and persistent illiquidity had meant the quotes it received from prime brokers were either expensive or uncertain.
The Asian play has been put on hold while BTIM works at introducing its Total Return Fund (TRF) to the retail market. Morris said clients “disappointed” by the decision to liquidate the Global Return Fund hedge fund-of-funds supported commercialisation of the TRF, where transparency is enhanced by BTIM having direct ownership of the assets.
Morris said the TRF has evolved from Australian equity long/short origins to now employ a mix of internal and external resources across global equity long/short, statistical arbitrage, event-driven, commodities and global macro strategies.
The head of multi-strategy funds at BTIM, Robert Swift, will employ two people as he works toward a PDS for the TRF being issued “hopefully by Spring”.
One of the hires will effectively become Swift’s 2IC, but with global fixed income portfolio management experience to complement Swift’s equity experience.Their responsibilities will centre around improving BTIM’s internal and external resources for long/short credit.
The other hire will be responsible for building up the risk controls and data management behind the TRF.
“We need to build a database of different manager return streams to make sure the mix we’ve got is optimal,” Swift said.
With just $200 million of mostly internal assets under management, Swift said the TRF had been producing “great numbers” and that BT had been “too modest” in not making it available to platforms earlier.