Brevan Howard Asset Management is giving full control of a systematic trading hedge fund to David Gorton as billionaire Alan Howard focuses on macro strategies, according to a person with knowledge of the matter.
Gorton’s London Diversified Fund Management will take over the $450 million money pool from April 1, said the person, asking not to be identified because the plan is private. The fund is currently managed by a joint venture between Brevan Howard and Gorton. Brevan Howard will have a stake in Gorton’s firm and Gorton will continue to manage some money for the company as part of the agreement, the person said.
A spokesman for Brevan Howard Asset Management declined to comment. Gorton didn’t reply to an e-mail or phone call seeking comment.
The move comes as Brevan Howard Asset Management has shut or spun off non-core money pools since 2014 as part of the firm’s plan to focus on its main macro hedge-fund strategy, the person said. Assets under management at Brevan Howard’s main hedge fund slipped to $18 billion at the end of February from about $27 billion two years earlier after losses in 2014 and 2015, according to a website for the firm’s listed fund.
Gorton started a joint venture with Brevan Howard in 2010 to manage the fund, which uses mathematical models to take investment decisions. The fund now oversees about $450 million, with about $200 million from external investors, and gained about 11 percent in the first two months of the year after losing 1.4 percent last year, the person said.
The move follows a similar decision last year to separate DW Partners LP, the firm run by credit trader David Warren, who took full management of about $6 billion that he invested for Brevan Howard Asset Management LLP.
Gorton founded London Diversified with Robert Standing in 1995 at JPMorgan Chase & Co., and the firm was spun off in 2002. It managed more than $4 billion in 2008, but the firm’s assets plunged following losses during the financial crisis.