UBS has opened up three hedge funds to outside investors under the O'Connor brand name. Two arbitrag...
UBS has opened up three hedge funds to outside investors under the O'Connor brand name.
Two arbitrage funds and a fund of hedge funds are now internationally available, under the overall control of Joseph Scoby in Chicago.
The investment adviser to the fund is UBS O'Connor LLC. The funds are sub-advised by UBS O'Connor in London, which is headed by Chris Salter.
The flagship fund is the Global Equity Arbitrage fund, which invests in three different strategies - merger arbitrage, convertible bond arbitrage and fundamental trading, a market neutral, fundamental-based trading strategy run by six global analysts. There is also a small amount of assets dedicated to ad hoc hedge fund strategies, including statistical arbitrage.
A team headed by Scoby and including Salter determines the asset allocation between the strategies on a monthly basis. Global Equity Arbitrage already holds in excess of $1bn in assets. Seed capital provided by UBS will be slowly phased out as the fund grows in size.
The second fund is the O'Connor Merger Arbitrage fund and both are Cayman-domiciled funds with a master-feeder structure and a minimum investment of $5m. Investors are typically private banks, fund of fund managers and various institutional investors from the US and Europe.
The Global Alpha fund, which started trading on 1 June, is a fund of funds investing in external hedge funds and is run separately from the other two. It invests in a variety of styles, including long/short and relative value and is run by Mike Welch. It has a 1/20 fee structure and a minimum investment of $1m.
The newly launched O'Connor business unit has its roots in O'Connor & Associates, an US equity derivatives trading firm that was acquired by Swiss Bank Corporation in 1992.
An ambitious objective
'Something completely new'
'Illusion of control'
Reasons to be cheerful
Total investment reaches £9m