Nascent Asia Fund Bets On Bond Prudence

Jun 11 2010 | 11:14am ET

A new Asian hedge fund is banking on something of a safe bet: that its home region will drive global economic growth for the foreseeable future.

Prudent Asia Capital Management is investing in Asian corporate bonds just above junk, believing they will be least burned by volatility in the markets, Bloomberg News reports.

“Once the market volatility settles down, that’s when we’ll go into high-yield, but we don’t think now is the right time,” co-founder Jim Lee, former co-head of equities at Deutsche Bank, told Bloomberg. For now, Prudent is buying bonds from businesses in non-cyclical sectors, such as financials, utilities and waste management, focusing on developed Asia-Pacific economies.

Lee and three others—Citigroup’s former Korean distressed asset chief Hong Na, Morgan Stanley’s former head proprietary trader in Hong Kong Jean Chung, and former DBS Group Singapore credit trading chief Alfred Ting—in December. The firm’s Prudent Asia Balanced Fund has netted US$30 million in commitments from Asian institutional investors, and hopes to raise US$500 million.

The new firm is based in Singapore.


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