June 30 (Bloomberg) -- Sparx Group Co., Asia’s biggest hedge-fund manager, plans to start its first global macro fund, adding a strategy that was among the few winners in 2008 when an equities rout led to the only annual loss in its 20-year history.

The fund, which will wager on trends in stocks, bonds and currencies worldwide, will be sold to institutional investors in the next few months as Tokyo-based Sparx expands beyond equity- related offerings, President Shuhei Abe said. He declined to give the fund’s size, saying that and other details are still being worked out.

“It’s going to be a new territory for Sparx,” Abe, 55, said in an interview in Tokyo last week. “We’ve been dependent on my past experiences in the equities market, but after the struggle we’ve gone through last year, we’re starting to utilize other expertise to expand the scope of our products.”

Managers of global macro hedge funds returned 3.9 percent in 2008, when the industry as a whole posted an 11.5 percent drop in its worst year on record, according to Eurekahedge Pte. Abe has pledged to return the firm he founded in 1989 to profit, after Sparx reported a 23.3 billion yen ($244 million) full-year loss in May amid the deepest market slump since the Great Depression.

A macro fund would be a departure from Sparx’s traditional focus on equities. Sparx Asset Management Co., a unit of Sparx Group, currently offers more than dozen funds, all of which invest predominantly in shares.

Sparx last year hired two proprietary traders with overseas work experience from a Japanese financial institution, part of the push to focus on a wider array of securities markets, Abe said. He declined to identify the company.

‘Baby Fund’

Separately, Sparx raised about 250 million yen for a Japan- focused hedge fund sold to individual investors that begins today. The fund, Sparx’s first new offering in almost six years, uses a long-short strategy, said Akihito Akashi, head of investment trust marketing division at Sparx Asset in Tokyo. Long-short funds bet on rising and falling asset prices.

The Japan fund will be the third “baby fund” that invests in the Sparx Japanese Stocks Long Short Strategy Mother Fund. Some 80 percent of its investments will track those of the Mother Fund, while the rest will be used for bets on securities such as index futures.

Sparx aims to increase the fund’s assets 100 times over the next five years, said Akashi. The firm’s second baby fund started with 150 million yen in 2003 and swelled to 15 billion yen by mid-2006, he said.

Japan’s benchmark Nikkei 225 Stock Average has gained 39 percent since plunging to a 26-year-low in March, amid signs that the global economy may be recovering.

Cash Flowing Back

Abe, who pioneered long-short equity funds in Japan, said the macro strategy is still uncommon in the world’s second- largest economy.

An index tracking global macro hedge funds gained 6.4 percent this year through May, Eurekahedge data show. Macro funds chase macroeconomic trends by trading stocks, bonds, currencies and commodities.

Hedge funds, beset by investor withdrawals in 2008, are starting to attract money again after outperforming stock markets this year. Global hedge fund assets rose by $30.3 billion to $1.32 trillion in May, the first increase in 11 months, according to Singapore-based Eurekahedge.

Total assets managed by Sparx have dropped more than 65 percent from an August 2006 peak, and stood at 687 billion yen as of May. In response, Abe has pledged to cut annual costs by 6 billion yen by March 2011 and reorganized the company along the lines of traditional and alternative investments.

Marketing Skills

“They have been hit by redemptions, loss of segregated accounts, and until March a down market,” said Edwin Merner, who helps manage about $3 billion at Atlantis Investment Research Corp. in Tokyo. “I am sure Abe-san is doing all he can to raise new money, and given the change in the tone of the market I would expect him to have some success, given his marketing skills.”

Sparx shares have gained 49 percent this year, rebounding from a record low in March. The stock added 0.6 percent today to 20,230 yen on Tokyo’s Jasdaq exchange.

Sparx was the top-ranked Asia-based single-manager hedge fund firm for a fourth straight year in 2009, with $4.8 billion in assets spread across its three units, according to Alpha magazine’s ranking.

Hedge funds are private, largely unregulated pools of capital whose managers can buy or sell any assets, bet on falling as well as rising asset prices, and participate substantially in profits from money invested.

To contact the reporters on this story: Tomoko Yamazaki in Tokyo at tyamazaki@bloomberg.net; Komaki Ito in Tokyo at kito@bloomberg.net

Last Updated: June 29, 2009 21:01 EDT