A pair of convertible arbitrage hedge funds is joining the UCITS III bandwagon.
CQS, the $6.7 billion London-based quantitative hedge fund, is preparing a UCITS-compliant convertible fund with the help of JPMorgan Chase. Another London firm, the Matrix Group, plans to repackage Lazard Asset Management’s Lazard Rathmore fund as a UCITS vehicle, the Financial Times reports.
CQS is awaiting regulatory approval for the JPMorgan Mansart Investments CQS Convertible Alpha fund, which it hopes to launch in April.
“We have been approached by a number of existing and new clients asking for exposure to a convertible arbitrage strategy in an UCITS III format because they are constrained by what they can investment in,” Nick Varker, senior executive responsible for product development, told the FT. But he warned that the new fund wouldn’t be able to match the offshore version of the fund because of the liquidity and risk rules that are part of the UCITS structure.
For its part, Matrix aims to bring the Lazard convertible funds to the masses. The strategy earned 58.4% last year.