Monday, July 15, 2024

Hedge fund launch market update: March 2023

  • AFI Pro and Executive members have exclusive access to the rolling tracker
  • You can also follow developments by checking our LAUNCHES section

Six new hedge funds were added to AFI’s launch tracker in March, a marked slowdown against the backdrop of sweeping market turbulence.

A trio of closures came to light, including Graticule Asia Macro, led by ex-Fortress manager Adam Levinson. The Singapore-based firm was the first well-known hedge fund to succumb after losses in this year’s volatility.

Another of the closures was longer in the making and more typical of the industry’s last few years. US firm Crawford Lake Capital Management, a long/short equity firm, closed after assets fell to little more than $100m.

”The last number of years have been very challenging for us and our returns have not met ours nor your expectations,” the COO told investors.

On the launches front, it was notable that three of the six involved leading multi-strategy managers, a magnet for flows and talent in recent years.

Plans by the likes of Todd Barker, ex-head of Surveyor Capital at Citadel, to start his own firm, Freestone Grove Partners, show it is not always a one-way street. 

Freestone could be one of the biggest launches this year but will be dwarfed if Bobby Jain, former co-CIO at Millennium, starts his own firm, which would presumably be a large multi-strat shop potentially rivalling ExodusPoint in start-up terms.

With has reported he is “exploring” a launch — if he proceeds it will be a major multi-strat entrant.

Separately, HFR reported that new hedge fund launches were on the rise in Q4 last year after hitting their lowest point since the financial crisis.

The estimated number of new hedge fund launches increased to 96, up from 71 in Q3. For the full year 2022, an estimated 432 total new hedge funds launched and 571 funds liquidated.

AFI’s tracker also shows 73 new funds this month according to US Form D filings.

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