Going down under with Singapore's FSL

Oct 3, 2005

A new, Australia-focused multi-strategy alternative product from Fairfield Straits Lion.

Singapore-based alternatives strategy manager Fairfield Straits Lion has launched its Fairfield Fortitude Australian Absolute Return Fund with a mandate to generate consistent returns while preserving capital, via various approaches including derivative enhancement, convergence trading, arb, event-driven and equity long/short strategies.

Fortitude Capital, an Australian hedge fund firm led by traders Tim McGowen and John Corr, will sub-advise the fund. Fortitude's management has a combined 40 years experience in Aussie equities and derivatives. McGowen has managed the proprietary trading books for some of the country's biggest investment banks, including ABN AMRO, Credit Suisse First Boston and UBS. Fortitude was previously known as Marshall Funds Management prior to a management buyout, and McGowen also managed private capital for the home office of John Marshall, subsequently winning an institutional mandate from Bankers Trust Australia.

John Corr says the firm has always emphasized low-risk, market-neutral strategies. Corr is a 20-year vet, having worked several banks' derivatives desks in the 1980s and 1990s, followed by eight years at Citigroup Global Markets Australia, including six as director of proprietary trading; he ran profitable books each of the eight years.

Cheong Tong-Foo, FSL's CEO, says the manager sought out Australian exposure as "ballast" to the higher-volatility markets in Asia. This is also preparation for a multi-manager, multi-strategy fund FSL is preparing to launch next year.

Fairfield Fortitude is domiciled in the Cayman Islands. Its minimum investment is $100,000. FSL and its parent, Fairfield Greenwich Group, provide full portfolio transparency to the securities level, and that includes the Fairfield Fortitude fund. Citco is administrator, KMPG is auditor and UBS is prime broker.

FSL was established in March 2004 as a dedicated hedge fund management and distribution platform in Asia. It is a JV between Fairfield Greenwich and Lion Capital Management, itself a JV from September this year between OCBC Asset Management and Straits Lion Asset Management. Lion is 70% owned by Great Eastern Holdings and 30% by Orient Holdings, a subsidiary of OCBC Group. OCBC Group also owns 81% of Great Eastern. The merger makes Lion Capital one of Southeast Asia's biggest managers, with S$30 billion of assets under management.