如何成立海外量化对冲基金

Generally in order to start a new quantitative hedge fund it will be expected that the manager will have had significant industry experience in other funds or asset managers in order to develop the necessary skills and network required.

The primary issue with starting a new fund is the significant cost involved in setting it up, as well as maintaining it going forward.

Historically, fund managers were remunerated on a ‘2 and 20’ basis. This mean that irrespective of investment performance the fund always received 2% of assets under management (AUM) per year. In addition, if the fund had a positive performance then 20% of the gain also went to the fund. This is a relatively lucrative fee structure. However competitive pressure has pushed fees down in recent years and has modified the business model of many quant funds.

Hence it is not uncommon to see ‘1.5 and 15’ or even ‘1 and 10’ fee structures. While it is difficult to accurately cost the setup of a new fund, since it depends on many factors, figures in the range of 100K-200K USD are not uncommon solely for the coporate structure of the fund. In addition to that are salaries of the managers/employees, as well as operational costs such as marketing and auditing fees, office rental, IT infrastructure (e.g. Bloomberg, quant workstations) and data vendor costs.

Hence, based on the ‘1 and 10’ fee structure it is likely that any new quant fund will need somewhere in the region of 50MM-100MM USD in assets under management to get started. This is usually why it is necessary to have a strong track record and extensive network in order to help the new fund at the early stages.

In terms of team members it is necessary to have a portfolio manager (who is often the fund manager at the start) as well as an individual with software development expertise to help develop the IT/trading infrastructure. Trading operations (including corporate actions handling, reconciliation of trades etc) will also need to be handled, but this may be carried out by the portfolio manager initially.

Please let us know if you would like any more detail on the above.