Fri, Dec 17, 2010 - Page 10 News List

Goldman star to launch major Asian hedge fund: report

CHOPPY WATERS:Goldman Sachs has had a difficult year, announcing in July that Q2 profits fell 82 percent following a huge US fraud settlement


A star player at troubled US banking titan Goldman Sachs is set to leave his post and set up a Hong Kong-based hedge fund that could be one of the largest in Asia, a report said yesterday.

The Financial Times said Morgan Sze, outgoing head of Goldman Sachs’ Principal Strategies trading desk, had begun raising money for what is expected to be the largest hedge fund launch since the financial crisis began.

It comes as Goldman Sachs is being forced to wind down the unit that Sze currently heads in response to US legislation framed following the crisis that bans large banks from trading with their own capital rather than clients’.

The Financial Times noted that at his peak, Sze had reportedly been one of the highest paid traders in the world, earning as much as double the pay of Goldman chief executive Lloyd Blankfein.

The new hedge fund is to be called Azentus and is tentatively expected to start trading at the end of the first quarter of next year.

Marketers for the fund expect it to start trading with between US$1 billion and US$1.5 billion, the report said, citing people familiar with the launch.

Hedge funds are lightly regulated and open to limited numbers of investors and engage in a range of sophisticated and often high-risk investment practices such as short selling.

The new Hong Kong-based fund underlines a shift in the hedge fund industry away from its traditional centers in New York and London, the Financial Times noted.

Goldman Sachs has had a gruelling year, announcing in July that second-quarter profits slumped 82 percent following a massive US fraud settlement and the costs of a new British tax on bonuses.

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