Former Huatai Asset Management CIO Yang Yang and seasoned derivatives trader Yiming Liang have teamed up to launch Goldstream Absolute Return Fund, an Asian macro hedge fund with a focus on Greater China.
The fund is slated to start trading in April with more than $50 million, having raised initial capital from family offices, high-net-worth individuals and funds of funds. It targets annualised returns of 15-20%.
Goldman Sachs and Bank of America Merrill Lynch are the prime brokers, while GlobeOp is the administrator.
The strategy, which will be run out of Hong Kong by Goldstream Capital Management, will invest across a range of asset classes and also takes a relative value approach, seeking opportunities in mispriced assets.
"At any point, we will look at equities both for long and short positions, and the fixed income market, which includes bonds, credit derivatives such as credit default swaps and convertible bonds," says Liang. "We'll also look at emerging market currencies, mostly in Asia."
Liang and Yang, long-standing friends who met as fellow students at the University of Science and Technology of China, set up Goldstream to combine their niche areas of expertise for an Asian hedge fund strategy.
Liang started trading derivatives in 1994 out of New York for Bankers Trust, joining Barclays Capital two years later, where he started its credit derivatives business. He relocated to Barclays' London headquarters in 1998 to lead the bank's global credit derivatives business.
Prior to setting up Goldstream, Liang served as managing director of financial markets for Standard Chartered Bank in Hong Kong.
Yang, meanwhile, has spent the past decade trading equities, bonds, and commodity and index futures in the US, Hong Kong and the mainland, most recently for Huatai Asset Management, one of China’s largest insurance fund managers.
Before joining Huatai in 2007, he co-founded US-based Dulles Capital, a private equity and hedge fund manager.
Despite volatile market conditions continuing from 2011, Liang views the market as opportunistic. "In every type of market – bull, bear and volatile – there are always opportunities. The key is to recognise and manage downside risk,” he says.
"When you're wrong you have to have the discipline to be able to get out. Then you go for the next opportunity. We look at ourselves as both an asset manager and a risk manager."