Monthly Archives: November 2020

Fund manager interview: Gary Norden, NN² Capital

Gary Norden

Gary Norden

Gary Norden in Australia is a seasoned derivatives trader who has been Head of LIFFE Options at NatWest and Head of Futures & Options Trading at Credit Lyonnais Rouse. As Gary is now launching a hedge fund business, NN² Capital, HFC boss Stefan Nilsson decided to check in with him to find out more.


NN² Capital specifically designs strategies that have close to zero correlation to equities. Can you tell us more about the investment strategy and why it is a bit different from what is already out there?

We started off by designing hedge trades for equity investors that would perform well even on an equity market rally. Over time we realised that the trades we designed have roughly zero correlation to equities in all market conditions and so decided to specialise in this type of strategy. Our trades are not found through just crunching data, they are constructed based on our decades of experience. Therefore, we believe it is hard for other funds to replicate them. So, our aim is to help investors smooth returns and reduce risk. We are not trying to be just an absolute return fund. We currently have half a dozen or so trades in the portfolio but are testing more and have plans to add many more.


You are based in Australia and your co-founder Nam Nguyen is based in Canada. Will you operate the fund with the team split up in two locations? If so, how do make that work practically?

Nam and I have worked together for around five years now so we have our own processes in place. Most financial institutions work across multiple locations so it isn’t a unique problem. We have already begun planning for how we will expand once AUM grows sufficiently and are consulting with an experienced COO in that regard.


You have planned the launch of your fund business over the past couple of years and now plan to launch in the coming months. What has been the hardest thing in getting to launch?

The hardest thing is probably just committing to go through with it. We could have just kept trading for ourselves but we had such a strong belief that we were creating a unique style of trades and fund that we thought we had to give it a go.


As a start-up fund manager, have you felt that service providers have been supportive during the set-up process?

I think all the service providers we contacted were supportive and professional in advising on the areas of their expertise. We were particularly impressed with our fund administrator Vauban and they have helped us across a number of different areas.


This year has been a strange and unpredictable year for most. How has the global pandemic impacted your launch preparations?

Our launch has been delayed primarily due to the pandemic. There were many documents that needed to be sighted and signed by a person of authority such as a Justice of the Peace and for some time, during lockdowns, for example, it was very difficult to get to see those people. Perhaps the hardest thing though has been the inability to travel to meet prospective investors. Online meetings may perhaps work OK for existing funds but for start-ups, meeting people in person is particularly important. We are very much looking forward to Hedge Funds Club events in 2021. It’s a shame we couldn’t go live earlier because our strategies have fared well this year, particularly in March but there are no short cuts to the process so we worked through it as quickly yet as methodically as we could.


In 2020 the macro environment has been hit with many twists and turns, not just because of the pandemic, but also an eventful US election, the ongoing Brexit situation and many other things. Have these events impacted how you as a fund manager look at markets and risks?

We always look at extreme scenarios when we design our trades. As I said earlier, we don’t just design them from backtesting or data crunching. By designing our trades in this way, we know specifically what the P&L drivers are and the main risks to them. We then stress test those risks to ensure we are happy with the P&L profile, drawdowns, etc. Our trades are designed to work in all market conditions and we try to take macro risks out of the equation as much as possible through the way we design the trades. We use very little leverage and also strongly favour long-volatility option style trades to further reduce risk. Between us, we have over 50 years’ experience so navigating through these types of risks and events are definitely important for us but also something we have been doing for a long time. As an example, early this year, around March-April, we saw many correlations tend towards one, i.e. many markets exhibited strongly positive correlations. Many low-correlation funds got hurt. Not only did our strategies show a profit but just as importantly, our correlation to equities remained consistent around zero. We were obviously delighted with this.


The pandemic has caused many investors to rethink allocations and, in some cases, seen them consider new fund managers. Do you think the timing of your launch may create new opportunities for you when it comes to more hedge fund investors looking at you?

We hope so! As I say, we believe we have a unique product but interestingly some funds of funds, for example, have said that it is hard for them to allocate to us because they can’t pigeonhole us in one particular strategy type! We don’t want or intend to become like other funds and will continue to be different though. However, we face the same issue that all new small, start-up funds face in that many larger investors, FoFs, etc will only allocate once we hit $Xmillion but it is hard to hit $Xmillion without a large investor. So, we remain on the lookout for such an investor.


What’s the story behind your company name, NN² Capital?

Finding a name for a hedge fund is so hard, almost everything is taken! NN² is taken from our surnames. We feel that Nam as a PhD/quant and myself as a derivatives trader together represent a more powerful team than the two as individuals, hence Nguyen-Norden squared.

The Hedge Funds Club Good Life Interviews – Part 50: Stefan Kosciuszko

Stefan Kosciuszko

Stefan Kosciuszko

Our popular light-hearted Good Life interview series turns 50! This time HFC boss Stefan Nilsson caught up with Stefan Kosciuszko in Hong Kong. Kosciuszko is perhaps best known as the former Vice Chairman, Asia Pacific of hedge fund manager CQS. The two Stefans had a wonderful chat about Lynyrd Skynyrd, Japanese pottery, Candace Owens, Nepalese coffee, Yorkshire Dales people, Polish can-do spirit, Le Caprice, the Gainsborough House Museum, Liverpool FC, a 45kg musclewoman and much more.


From where and how do you get your daily general news updates?

By email from the SCMP, the overnight news from the FT in London, the Nikkei in Tokyo, London Evening Standard and then, to round off, Bloomberg TV news for the most up to date market movements.


What do you do to unwind on a weekend?

Any international rugby is de rigeur, or Match of the Day is a special favourite for me and my wife, and, hopefully, that is before I go to sleep watching her interminable medical/police/fire dramas. Having friends round for a BBQ does not happen enough as my wife runs with my daughter two galleries in HK (one in PMQ and one in Cheung Chau – selling beautiful Japanese pottery. So, the weekends are important for them and also exhausting, with a never-ending stream of new exhibitions, also supporting up and coming HK ceramicists, to counteract the 98% decline in tourists this year and the protests the year before. They survive in spite of…..with some wonderfully supportive clients who are now building some serious pottery collections, including artists selected by the British Museum and with Christmas gifts in mind they are about to become very busy again.


Can you name a great book you have recently read?

“Blackout” by Candace Owens which has a sub-heading of “How Black America Can Make Its Second Escape from the Democrat Plantation”. An inspiring and uplifting story with some great facts at her disposal and she is a leading candidate for the Presidency in 2024 when we get over the old and tired men of the 2020 race.


Your soundtrack of choice?

That would have to be “Freebird” by Lynyrd Skynyrd which has hugely powerful lyrics and guitar riffs, all about moving on, and is one of the greatest rock anthems of all time. Not overly produced, just some good ol’ boys from Florida with guitars and a piano, tragically taken away from us at their very peak in a plane crash in ’77. Always raises the spirits when I put it on.


What drink do you start the day with and what drink finishes it?

Coffee sourced from small farms in the foothills of the Annapurna mountain range in Nepal, grown organically and roasted in the country. The smooth flavour is only exceeded in terms of pleasure, knowing that one is directly helping single crop subsistence farmers in the best possible way.


What’s the worst money mistake you’ve made?

Always buying houses that we wanted to live in, rather than seeing the bricks and mortar as purely an investment. I will pass on from this world as poor, but happy, as we have lived in and renovated a Grade I listed house built in 1290, as well as a 15C house in a Yorkshire Dales valley with no mains water, drawing directly from the mountain beck, but with the most lovely neighbours one could ever imagine, that will, without asking, light the fires and bring fresh scones when they know we are coming back. A good life is not just about money and the Dales and its people are special.


Have you ever had a great mentor and what did you learn?

That would be my former boss, Paul Sauvary, at Schroders of many years of association as a client and boss, whose razor-sharp intellect only deferred to me when he needed an attack dog to get things done, or arguments won, in complicated government privatisation advisory assignments where we worked together. We were a great team and I learnt from him that a carefully chosen word at the right time, was a perfect foil to my Polish “can do” spirit and bravado. Teamwork is everything.


What gives you energy?

Taking pride in the numerous achievements of my two daughters, not least of which attending Westminster School and Charterhouse School and then Cambridge University and getting a First from Durham University, and when they were younger knowing that they needed my support and the best education I could deliver always managed to spur me on when energy levels wavered or I was frequently away on the road. Fortunately, they both decided to come and join us in Hong Kong and with one who ran for some years the events and sponsorship team at the British Chamber of Commerce, and one an entrepreneur and businesswoman par excellence they never cease to delight.


How do you stay grounded and focused as a person in these turbulent and fast-changing times?

Surrounded by women at home to keep me on the straight and narrow. My Japanese wife, two daughters, two female dogs and a steady supply of wine that I have collected over many years – since I first started working – that I drink and enjoy whenever rather than gloating over the price. A moment of reflection is always helped by a good bottle of red and remembering when and why one bought it causes a veritable flood of endorphins.


Can you name a terrific restaurant that you love?

Sadly closed this year, Le Caprice restaurant in London fronted by Jesus Adorno was my local café in St. James’s serving top food for an affordable price from a sparkling team of people dedicated to making sure you and your guests always had a wonderful experience. It was incomparable cuisine, and regulars could always get a table no matter how busy and in spite of the three-month reservation waiting list at its peak. Truly a great institution and I would fly to London especially for its reopening party…..maybe soon. Now in Hong Kong, my special favourite is MOTT 32 and their excellent roast duck and in Tokyo, Zakuro, which has the best shabu-shabu sesame dipping sauce which is an old secret, and never disclosed recipe, so really the secret sauce!


What’s your favourite museum in the world?

This would have to be Gainsborough House Museum in Sudbury, Suffolk where I was honoured to be asked to act as a Governor for some years. The museum is located in the birthplace of this leading artist, before he went to London to make his fortune as a portrait artist, although his brilliance is best shown in his landscapes in my view. He was also a contemporary of Constable and one of England’s best-kept secrets is the Stour River valley linking Gainsborough in Sudbury and Constable in Dedham. This museum is a wonderful example of a small local community taking pride in one of their sons and creating, with not inconsiderable effort and fundraising, a centre of excellence for the study and appreciation of Gainsborough paintings by people who come from all around the world.


Are you active on social media and what do you actually use it for?

Reasonably active on Facebook and Instagram as a time-efficient way to keep up to date with what is happening with friends old and new. Under no circumstances Twitter.


Do you have any secret guilty pleasure that you are prepared to reveal here?

Every Liverpool FC victory, with their very best performances coming almost always against all odds. They have a real football club atmosphere and spirit and every player lucky enough to put on THAT red shirt will always comment on how much that meant to them for the rest of their career. Standing and singing in The Kop is an unbeatable experience and Klopp has worked wonder and as a German is loved deeply in a very English city.


What kind of battle dress do you normally put on for work?

Functional suits, and elegant Hermes ties, pre-Covid, which have lasted a long time, eight of which just went to the recycle bank and now with regular working from home, t-shirts and shorts feel good in a humid Hong Kong summer, and if Zoom calls, then a blue or white work shirt of the best cotton I can afford from Jermyn Street.


Do you celebrate your wins? If so, how?

Champagne with those who also contributed to the win is the only way.


What makes you happy?

What makes me truly happy is making and seeing other people, family, or animals (my dogs), happy and that warms the heart in a way that nothing else can. Since I came to HK six years ago, we have kept the same helper with us who has moved us from Repulse Bay to Lantau Island, to Cheung Chau Island, and soon to move back to Lantau Island. During that time, she has been loyal and worked very hard, sending money back to her family and importantly saving enough money to build her own home in the Philippines. The look of sheer pride and happiness on her face when we talk about it is so very special, and the feeling that you have made an important difference in someone else’s life is absolutely priceless. On the same happy theme, I took on a two-year-old rescue rottweiler who had moved many times between foster homes and the rescue shelter looking for her forever home. She had serious heartworm, cherry eyes and other markers of neglect. But when I saw her picture, I saw a heart of gold crying out for help and love. This dog breed, created by the Romans 2,000 years ago to guard livestock from wolves and bears, is fiercely loyal in their DNA and to keep changing her circumstances would have been breaking her heart. My Australian vet who looked after Rotties in Oz before coming to HK, on the first meeting simply said: “You are brave to take her on”. After six months of expensive and dangerous treatment to solve all her problems, he always gushes now that she is the kindest and most gentle family dog that he works with, which is good because she is now a 45kg musclewoman looking after her own super happy family.

News: Raffles recruits Yvonne Siu

Yvonne Siu

Yvonne Siu




Yvonne Siu has joined Raffles Family Office as Group COO. Yvonne has spent the bulk of her career at Credit Suisse, most recently as COO APAC for its quant fund business. She started her career as a tax consultant at PwC in Hong Kong.

News: Leonie Kelly joins Ogier in ESG role

Leonie Kelly

Leonie Kelly




Leonie Kelly has joined offshore law firm Ogier in Hong Kong as Head of ESG and Impact Advisory. She joins from Sustainable Finance Initiative where she was a Partner. Her career has also included stints at the Zoological Society of London, Deloitte and Citi.

News: Nicholas Ng joins Haitong

Nicholas Ng has left his role as Head of Family Office Funds at Abacus Capital in Singapore to join Haitong International as VP, Institutional Equity Sales. Earlier he as worked at National Australia Bank, S&P and Oxford Economics.

News: Alex Ng leaves Aberdeen

Alex Ng

Alex Ng



Alex Ng has left Aberdeen Standard Investments in Singapore. Prior to joining Aberdeen in 2015, he worked at Lion Global Investors, Reliance Asset Management, Superfund, Doric Capital and Eurekahedge.

News: Eric Yee leaves Kiara for SingAlliance

Eric Yee has been appointed Portfolio Manager at SingAlliance in Singapore. He was most recently an Associate Portfolio Manager at Kiara Advisors. Earlier he worked at DBS Vickers and Great Eastern Life Assurance.

News: CFM’s Uchiyama joins Japan Post

Yuji Uchiyama

Yuji Uchiyama



Yuji Uchiyama has been appointed COO of Japan Post Investment Corporation. He was most recently a director of CFM in Tokyo and earlier had roles at BlackRock and Bank of Tokyo-Mitsubishi.

News: Elisabeth Thom leaves Flowering Tree

Elisabeth Thom

Elisabeth Thom


Elisabeth Thom has left her role as a Partner at Flowering Tree Investment Management in Singapore. She had been with the firm since 2009. Earlier she has worked at JL Capital, Ferox Capital Management and Goldman Sachs.

News: Jenya McGuigan joins Torq

Jenya McGuigan

Jenya McGuigan



Jenya McGuigan has joined Torq Capital Management in Hong Kong in an IR role. She was most recently in IR at Doric Capital and has previously worked at Navis Capital Partners.