Goldman Convertibles Vet Launches Multi-Strategy Hedge Fund

Jul 7 2010 | 12:09pm ET

The former head of convertible bond trading at Goldman Sachs has launched a Japan-focused hedge fund with plans to increase the size of the vehicle by more than US$300 million.

Round Rock Capital Advisors’ R-SQUARED Master Fund debuted on April 1 with ¥1.36 billion (US$15.5 million). But Tan Maruyama, the Goldman vet behind the Tokyo-based firm, has also seen that grow to ¥1.6 (US$18.2 million), and hopes to have ¥10 billion (US$114 million) in assets under management within a year, and a whopping ¥30 billion (US$342.1 million) within 18 months. It has a capacity of ¥50 billion (US$570.2 million).

“There isn't that much competition in Japan, even with the market size we have, which gives us an edge with the sort of background we have,“ Maruyama told Bloomberg News of his ambitious plans. The young fund—which returned 0.7% in its first three months of trading, using a strategy that enjoyed a 5.2% return on paper during the first three months of the year—has already attracted several new high-net worth investors since its launch.

Joining Maruyama at the new venture are a pair of former Capital Investment Management managers, Takatoshi Itoshima and Satoshi Kamata, as well as Shuhei Komatsu, who joins from Merrill Lynch.

“Investors also told us the Japanese hedge-fund space has been dominated with long/short funds and they were becoming interested in other strategies, which prompted us to enter,” Maruyama explained. Round Rock offers them three main strategies in its multi-strategy vehicle, long/short equity, credit and convertible arbitrage.

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