CQS Said to Plan Equity Hedge Fund With Ex-SAC Manager MorantJesse Westbrook
CQS U.K. LLP, the $12 billion hedge-fund firm founded by Michael Hintze, is looking to start an equity fund as the company expands beyond its focus on credit investments, said two people familiar with the matter.
The new hedge fund would be managed by David Morant, who joined London-based CQS from Steven Cohen’s SAC Capital Advisors LP last year, said the people, who asked not to be identified because the information is private. The fund would focus on European stocks, betting on both rising and falling prices, the people said.
CQS joins hedge-fund managers BlueCrest Capital Management LLP and Tudor Investment Corp. in considering an expansion into stocks after the MSCI World Index gained about 24 percent over the past 17 months and firms look to new markets to grow their businesses. CQS invests in convertible bonds, corporate debt and asset-backed securities.
Michael Rummel, a CQS spokesman, declined to comment on the firm’s plans to start a stock fund.
More hedge funds are looking to invest in European equities after the European Central Bank flooded markets with money, making traders less concerned about the risks posed by the region’s sovereign-debt crisis. The crisis had caused shares to move in lockstep, making it difficult for traders to pick winning and losing stocks based on company fundamentals.
Morant joined CQS in May 2012 from Stamford, Connecticut-based SAC along with Ben Halfacre, an equity analyst, according to the people and registrations with the U.K.’s Financial Conduct Authority. CQS also hired analysts Daniel Woodbridge and Alex Torrance from Marble Bar Asset Management LLP and Saxlingham Asset Management LLP, respectively, FCA records show.
Hintze, 59, started CQS in 1999 after trading convertible bonds at Credit Suisse AG. His $2 billion CQS Directional Opportunities Fund climbed 36 percent last year, boosted by his view that central bank stimulus would fuel gains for asset prices, one of the people said. Hedge funds rose 6.7 percent in 2012 on average, according to data compiled by Bloomberg.
Directional Opportunities has gained 7.6 percent this year, and has produced an average annual return of 21 percent since Hintze started the fund in 2005.