Barun Agarwal, a former DKR Oasis portfolio manager, is planning to launch a pan-Asia multi-asset hedge fund in January.
The Factorial Master Fund will be managed out of Hong Kong and invest “across equities, credit, convertible bonds, volatility and derivatives of these asset classes”, says Agarwal.
Some capital has already been committed by private investors, including high-net-worth individuals, says Agarwal, who declined to give a figure, saying it fell within the range of an average start-up capital of a fund. In Asia, that typically equates to $20 million to $25 million.
Institutions and family offices have expressed interest and may come onboard as early-stage investors, says Agarwal, who left the $3 billion multi-strategy fund DKR Oasis in August after seven years as a portfolio manager.
He will serve as the chief investment officer at Factorial Management, which is awaiting licence approval from the Hong Kong Securities and Futures Commission. The fund will initially have a team of four – including two investment executives – and is putting in place institutional-grade systems and processes. Goldman Sachs and Bank of America Merrill Lynch are the prime brokers for Factorial.
Potential opportunities in Asia in the coming year include event-driven equity plays, credit – particularly short-dated credit – and convertible bonds, once issuance comes back, says Agarwal.
Factorial Management is the latest hedge fund firm in Asia to be launched by an ex-DKR Oasis executive. Silver Tree was set up in Hong Kong by DKR Oasis co-founder Edward McCreight and former portfolio manager Nasrine Ghozali last year, following the 2009 launch of Fred Eechaute’s Japan-focused Instinct Capital in Sydney.