The Instinct Japan Opportunity Fund launched on December 1. The fund is being managed by a new firm of alternative investment managers called Instinct Capital based in Sydney, Australia.
Instinct comprises of two principals -- Fred Eechaute, who is the Investment manager, and Stephen Good, the business manager. They are joined by Anita Lam who is the trading/operations manager. The former two have worked together at Mizuho Securities in Japan, while Eechaute has also worked with Anita Lam at DKR Oasis.
Most recently Eechaute was responsible for the Japanese equity long/short and event-driven book at DKR Oasis, Japan where he managed a team of analysts and made positive returns during the last five years. Instinct intends to add an additional Japan event-driven specialist investment manager in the next month.
The fund's strategy is Japan event-driven, looking at catalysts such as corporate actions, capital raising, fundamental catalysts, tactical trading and special situations. Instinct will be making use of the network of contacts that Fred Eechaute has built up over the past 10 years in order to plug into putative events.
The partners say their core competency is the broad investment experience of the investment manager gained at DKR Oasis where Eechaute focused on diverse strategies.
They will be looking to build a portfolio across the top 200 liquid names in the Topix and to adopt a trading-oriented approach. The fund will specialise in short-term events with an investment horizon of typically five days or less on average.
The soft close of the fund is $200 million, and it launched with seed capital from high-net-worth individuals, friends and family. Institutional investment will follow in the coming months. It has a 15-20% target return regardless of market conditions, with relatively low volatility appropriate to a market-neutral approach.
Redemption is 30 days' notice and the fees are 1.5% management fee and 20% performance fee.
Instinct has appointed Credit Suisse as prime broker. Imagine Software supplies the risk tools.