By Klaus Wille
(Bloomberg) — Scott Treloar, a former Deutsche Bank AG quant specialist, has started his own hedge fund that allocates money to traders around the world.
Noviscient Pte aims to have $40 million of assets by the end of this year and $250 million by December 2019, Treloar said in an interview. He’s targeting returns of 10 percent to 15 percent a year — more than double the average hedge fund return of the past 10 years of 4.6 percent, according to data provider Eurekahedge Pte. The fund will charge a 36 percent performance fee, but won’t levy management charges.
Rather than employ portfolio managers in his Singapore office, Treloar allocates funds to strategies provided by traders based around the world. A commodity futures trader with a doctorate in machine learning is based in Australia, while another is working from the U.S. and focuses on systematic volatility trading of ETFs.
Treloar joins a handful of managers striking out on their own in Asia, as investor disaffection with high fees and lackluster returns have helped push hedge fund openings to the slowest pace in 17 years. Some sizable new funds in the region include Ayan Sen’s Navik Capital (Singapore), which started this year with $400 million and Ovata Capital Management, which opened in December with more than $200 million in initial capital.
In all, Noviscient has four strategies on its platform and is testing a further 15, Treloar said. Capital increases or reductions to each strategy are made weekly, based on performance, and the traders get 20 percent of their net profits paid quarterly, he said.
Before starting Noviscient, Treolar was portfolio manager and chief risk officer at Singapore-based hedge fund Vulpes Investment Management Pte. He spent eight years running a quant group at Deutsche Bank, and has taught quantitative finance at Singapore Management University.
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