Former BlackRock employees plan Hong Kong-based fund

BlackRock, Macquarie Group and Millennium Capital Management former employees are planning a Hong Kong-based hedge fund which will use computer models to spot trading opportunities in 13 Asian stock markets.

Zentific Investment Management, led by chief investment officer Christopher Lee, will start the market-neutral fund early next year, said a statement from HS Group, a Hong Kong-based provider of long-term capital to newer hedge funds, which will be one of its first investors.

The other investors are Zentific partners and unidentified institutions, according to the statement. Mr Lee, who headed BlackRock’s scientific active equity department in Hong Kong, will be joined by head of research Burke Lau, who led Asia and Japan quantitative research at Macquarie Securities.

Michael Friedlander, Zentific’s chief operating officer, used to work for billionaire investor Israel Englander’s hedge-fund firm Millennium, according to the statement. Asia’s hedge fund industry was until recently dominated by long-biased funds, which rely on market rallies for their returns and can’t generate profits in downturns.

Funds that use computer models to process large volumes of information are rare in Asia. “The reason investors like this strategy is because Asia’s markets are so diverse, it’s hard to cover them all comprehensively,” said Michael Garrow, HS Group’s chief investment officer.

There are nearly 8,000 stocks with an individual market value of more than $200 million listed on Asia-Pacific region exchanges, according to data compiled by Bloomberg. – (Bloomberg)