Ward Ferry Management has closed the doors of its $200 million long/short hedge fund to new investors but will take up to $100 million more from existing stakeholders before capping the fund at around $300 million.
The move is designed to keep the volatility of the WF Asia Fund at manageable levels, says Peter Ferry, director and one half of the two-man team that also includes stock-picking guru Scobie Ward. "When you can't short individual stocks in many Asian markets it's important to keep the fund at a certain size otherwise our volatility starts to increase."
Ferry says the door will remain open to existing investors for a period of time. "Basically we are trying to reserve capacity for people who backed us from the start."
Ward Ferry has achieved the sort of asset growth that most startups aspire to. The pair left Lloyd George Asset Management to launch the fund in early 2001. By the end of last year they had raised $80 million in monies from high net worth individuals, family offices, pension plans and funds of funds. By mid April that number had grown to $200 million with no investors taking advantage of the monthly redemption option.
"When we market our fund to investors we focus a lot on our low volatility track record," explains Ferry. He says that in order to maintain the fund's approach - which emphasizes mid-cap stocks and concentration of holdings - it needs to be capped at a manageable level.
This level is about $300 million he believes, which market commentators say the fund will have no problem reaching once existing investors know they have a limited window in which to invest more.
The decision to close the fund comes along with the announcement that Lilik Widjaja has joined the team at Ward Ferry as a Tokyo-based company analyst. An Indonesian national, Widjaja has spent about 10 years in Japan and comes from Cazenove where he spent three years working as a research analyst covering technology and telecommunications.