Brevan Howard Asset Management LLP is raising cash for two new money pools that offer daily liquidity and don’t charge a performance fee as the firm diversifies its $20 billion hedge fund business, a person with knowledge of the matter said.
The funds are part of a new unit led by Roberto Hoornweg, the former UBS Group AG executive who joined Brevan Howard in 2014, the person said, asking not to be identified as the information is private.
The move marks Brevan Howard’s push into the liquid alternatives funds market that has grown to $784 billion at the end of the first quarter, compared with $697 billion a year ago, according to data from Morningstar Inc. Investors favor these low-cost products because they provide more transparency on how exactly they make money and allow clients to exit or invest more frequently than hedge funds.
Brevan Howard Dynamic Global Investment Fund and Brevan Howard Dynamic US Investment Fund invest across asset classes and started trading with capital from the firm led by billionaire Alan Howard in December, according to the funds’ website. The two funds had combined assets of $151 million at the end of February and offer daily liquidity, the website shows.
A spokesman for Brevan Howard declined to comment.
Brevan Howard, best-known for running hedge funds that bet on macroeconomic trends, has seen its assets decline from $40 billion in 2013 after two years of successive declines in its flagship product. The Brevan Howard Master Fund closed the first quarter down almost 1 percent after losing 2 percent in March, according to a company website.
Investors in Brevan Howard Asset Management have asked to pull about $1.4 billion from the firm’s main hedge fund, two people with knowledge of the matter said last month, as investors flee the industry at the fastest pace since the financial crisis.