Due to government restrictions and social distancing recommendations, all our networking events in Tokyo, Singapore, Hong Kong and Australia are currently on hold. We are monitoring the situation and hope to be able to resume our event schedule soon.
Monthly Archives: September 2020
UK-headquartered US$48bn hedge fund manager Marshall Wace plans to open a Singapore office. It has already been granted a fund management licence by MAS. The firm already has offices in Hong Kong and Shanghai. It seems the new Singapore will house both portfolio managers and marketers. The new office will be led by Timothy Quah who joined the firm a year ago as an Investment Analyst in Hong Kong. He has previously worked at Fidelity, Pacific Eagle Asset Management, Orbis Investment Advisory and Dresdner Kleinwort.
Yesterday, Australia-based crypto fund manager Henrik Andersson, Chief Investment Officer of Apollo Capital, participated in the joint Hedge Funds Club and OSL webinar on digital assets. Today, HFC boss Stefan Nilsson decided to have a chat with Henrik about who he is, how he ended up managing a crypto strategy and what some of the obstacles and opportunities are.
Tell us a bit about yourself and your background.
I’m originally from Sweden. After graduating, I spent around 15 years in traditional finance, in quant equity and in institutional equity sales. I worked across Scandinavia, Singapore and spent close to a decade in New York. I got into digital assets in 2013 and after moving with my family to Australia decided to set up one of Australia’s first crypto funds, Apollo Capital, together with my co-founders. I’ve also co-founded two decentralised finance (DeFi) projects in the crypto space.
You have worked in various areas of finance in your career, including equity sales in New York. How did you go from more traditional asset classes to all-in on crypto?
In 2013, we saw one of the first crypto waves of adoption. At the time I worked on Wall Street and suddenly bitcoin started appearing more and more frequently on the trading screens. That piqued my interest and I learned about bitcoin and its foundation in a computer science breakthrough. Having a strong interest in technology, coupled with markets and a libertarian-leaning definitely helped fuel my passion for crypto. Suddenly I saw my interest in traditional markets fade as I learned more about crypto. The space has a fascinating depth with a lot of layers to uncover and it’s ever-changing.
Like me, you are Swedish and have worked internationally. Why did you decide to set up Apollo Capital in Melbourne, Australia?
I moved to Melbourne in 2015 with my family. My wife is from here and having had kids in New York we missed being close to an extended family.
You run a multi-strategy cryptocurrency fund. Was the multi-strategy approach an obvious choice when you decided on what kind of digital asset strategy you would launch? What sub-strategies do you include in your fund?
I think it is the right approach for this asset class. It’s still a very young asset class so being multi-strategy means you can find the best alpha strategies across a range of strategies and you can remain flexible in this fast-changing market. We have a long fundamental portfolio, as well as arbitrage, event-driven strategies and lately we have been very active in what is being called “yield-farming”.
What is the biggest risk management headache in today’s crypto trading world?
Using multi-sig, or multi-signature authorisation, across an organisation can still be a headache. The infrastructure has improved a lot but still have ways to go.
What’s the biggest lesson you have learnt since setting up your fund about three ago?
If you’re open and transparent towards your LPs they will trust you and believe you even through the deepest of bear markets. We launched Apollo Capital at the start of one of the biggest bear markets in crypto. Those investors that stayed with us – and everyone did! – are now handsomely rewarded by the current growth we are seeing.
As crypto funds and cryptocurrencies attract more interest from institutional investors, are funds like yours able to cater to the needs of both retail and institutional investors or do you have to focus on one type of investor?
So far, we have been able to cater both to HNW and institutional investors. As we see more institutional investors entering the space, it’s likely that some of them will require certain mandates related to types of strategies, risk mandates, etc.
As the crypto world is becoming more institutionalised, are we likely to see a clear-out of less professional crypto traders and funds who will be forced to close shop as they cannot meet the stricter demands?
Yes, the space is getting more and more professional all the time and the demands from the type of investors entering the space will set the bar even higher. Having a long track-record coupled with the right infrastructure partners and strong internal processes will certainly be critical in order to meet those demands.
The Eurekahedge Greater China Hedge Fund Index was up 1.94% in August, bringing their five-month performance to 28.33% since end-March. In the same vein, the total AUM of the region also grew by 31.3% since end-March from US$38.5 billion to US$50.5 billion, primarily driven by performance-based growth which accounts for US$11.2 billion from its total increase of US$12.0 billion.
Global hedge funds recorded their best five-month performance of 12.85% in August after they suffered from their worst quarterly performance of 8.02% in Q1 2020. In terms of year-to-date return, the Eurekahedge Hedge Fund Index was up 3.79%, with around 22.5% of hedge funds managers posting double-digit returns over the first eight months of the year. Assets under management for the global hedge funds industry have rebounded, increasing by US$142.8 billion over the five-month period ending August 2020. This has come from performance-driven gains of US$122.5 billion and net investor flows of US$20.3 billion. This marks a sharp recovery following US$264.1 billion asset decline in Q1 2020.
Linnda Chuang has started a new position as New Business Lead – Global Multi-Family Offices and External Asset Managers at Nomura in Singapore. Earlier in her career, Linnda has worked for hedge funds Seekers Advisors and United Crest Capital and has also had stints at firms such as Vontobel, UBS, HSBC Insurance, SMBC, UOB and American Express Bank.
Mark Henry Brugner has been promoted to President of Europe and Asia-Pacific at APS Asset Management in Singapore. He joined APS in August 2019 and initially served as President of Asia and Australia. Previously, he worked at Willis Towers Watson, INNOVEST and Bank Austria Creditanstalt.
Ken On has joined Eurex in Singapore as a VP. He will focus on sales and business development in Asia-Pacific and the Middle East. Most recently he has spent five years with Korea Exchange.
Patricia Cheung, COO of Value Partners in Hong Kong, has left the firm.
Hong Kong-based William Ma, CIO of Noah Holdings and Gopher Asset Management, has been appointed as Board Member of the CAIA Association. William made a name for himself in the hedge fund industry with stints at Penjing Asset Management, Vision Investment Management and HT Capital Management.
Kenji Nakanishi, former Vice Chairman of JP Morgan Securities in Japan, has been appointed Vice Finance Minister in Prime Minister Yoshihide Suga’s new administration.