Goldman Sachs

Goldman targets Asia investments with new fund

The US bank's venture comes after regional hedge-fund assets hit highest level in six years

PUBLISHED : Friday, 20 September, 2013, 12:00am
UPDATED : Friday, 20 September, 2013, 3:51am

Goldman Sachs Investment Partners, set up to allow clients to invest with some of the bank's top proprietary traders, is raising capital for a new Asian fund, two people with knowledge of the matter said.

The fund, named Oryza Capital, started early this month, the sources said. It is overseen by a team led by Hideki Kinuhata in Tokyo and Hong Kong-based Ryan Thall, they said, without disclosing how much money the fund is seeking to gather.

Kinuhata and Thall did not reply to e-mails seeking comment and a Hong Kong-based Goldman Sachs spokeswoman declined to comment.

The team is raising money after inflows into Asia-focused funds took regional hedge-fund assets to US$98.4 billion as of the end of June, the highest since 2007, according to Chicago-based data provider Hedge Fund Research.

Asian stocks and Japan- focused funds drew US$3.9 billion of new capital in the second quarter of this year, more than the US$3 billion net inflows to the regional hedge-fund industry, it added.

Peter Douglas, a principal of Singapore-based hedge fund consultant GFIA, said the fund was consistent with banks' attempts in recent years to turn former proprietary trading units into fee-generating revenue sources.

"The bank ties up less Basel-expensive risk capital and generates more of the return from the strategy from fees rather than trading gains," Douglas said, referring to the international accord governing bank capital.

Thall plans to discuss an Asia-focused opportunistic equity long/short fund with potential investors at a Morgan Stanley hedge-fund forum in Hong Kong next month.

The new fund would invest in Asia, including Australia and Japan, one source said.

Tokyo's Nikkei-225 Index has gained 64 per cent in the past year. Japan's exports rose the most since 2010 last month after the yen weakened more than 11 per cent against the US dollar this year amid unprecedented stimulus by Japanese Prime Minister Shinzo Abe and the Bank of Japan to rejuvenate the economy.

"More and more intellectual power and international capital are being focused on Japan," Douglas said. "Five years ago you wouldn't have had one leg of this proposition based in Tokyo."