Ex-Pimco Manager Said to Plan Bond Hedge Funds With $500 MillionBy
Han said to line up three investors for Hong Kong-based funds
His DeepBlue said to start global, Asia funds this quarter
Han Tongli, a former Pacific Investment Management Co. manager, plans to start two hedge funds focused on fixed-income investments in the first quarter, said a person with knowledge of the matter.
Han, 39, has attracted three strategic investors, including one U.S.-based institution, into his Hong Kong-based DeepBlue Global Investment, said the person, who asked not to be named because the information hasn’t been publicly disclosed. The investors will channel a combined $500 million into the global and Asia-focused funds, the person said, without naming them. Han declined to comment.
DeepBlue, whose name seeks to invoke the depth of the fixed-income, interest rate, commodity and currency markets, will express macro-economic views by trading such securities, according to the person. There is a dearth of such managers in Asia, where stock pools accounted for 62 percent of industry assets as of June 2016, compared with 28 percent globally, according to Hedge Fund Research Inc.
Hedge fund launches worldwide have stumbled as investors have pulled back because of lackluster returns. Globally, 576 new hedge funds were started in the first three quarters of 2016, headed towards the slowest year since 2008, according to HFR data. Investors pulled $70 billion from the $3 trillion industry last year in the first annual outflow in seven years, the Chicago-based data provider estimated. There were 49 new hedge fund starts in Asia last year, the lowest on record, according to Singapore-based Eurekahedge.
Some Asian hedge fund have attracted investor money. Blackstone Group LP invested $150 million in the multi-asset hedge fund of Hong Kong-based Asia Lion Capital, started last year by Jim Li, a former proprietary trading head at China International Capital Corp., said a person with knowledge of the matter who asked not to be identified because the information is confidential. Li, whose firinvestments include equity, credit and currencies, declined to comment.
Symmetry Investments, an Asian bond and rates-focused hedge fund set up in 2014 by a Millennium Management team led by Guo Feng, expanded assets to $2.6 billion as of February 2016, according to its website.
DeepBlue’s funds will take long-biased bets on both high-yield and investment-grade bonds denominated in hard assets and emerging-market currencies. They can also trade exchange-traded funds and stock indexes.
Han last year left Fosun Group where he was chief investment officer of fixed income. He started and led its investments in Russia and Brazil, said the person. The Chinese native worked for Pimco between 2007 and 2011, and was one of six emerging-market fund managers who together oversaw $150 billion of assets in Newport Beach, California, said the person. Pimco, once the world’s biggest manager of bonds, ranks among the industry’s largest investment firms and had $1.47 trillion in assets as of Dec. 31.
Han started his financial career trading for Bank of China Ltd. and helped oversee about $80 billion of proprietary investments in developed markets fixed-income securities for the Chinese bank.
After his stint at Pimco, he returned to Hong Kong in 2012 to head fixed-income at the Hong Kong unit of Bank of Communications Co., China’s fifth-largest lender. The global strategic emerging markets bond fund he led had the best one-year return among 126 Hong Kong-domiciled pools tracked by Bloomberg when he was recruited to Fosun in October 2014.
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