SAC's Akay Plans $500M Emerging Markets Hedge Fund

Sep 23 2011 | 2:10pm ET

A former SAC Capital Advisors trader is readying an emerging markets hedge fund for launch later this year—possibly with a very big backer.

Ali Akay left SAC's European unit in the summer and has founded Carrhae Capital in London. The new firm, which plans to begin trading in December, will invest both in companies based in emerging markets as well as those who do business there.

Akay named his firm after a 1st century B.C. battle in which the Parthians, the ancient rulers of what is now Iran, decisively defeated the Romans in what is now Akay's native Turkey. The Roman catastrophe was the result of "arrogance, an inability to listen to [the commanding generals'] local allies, impatience and a lack of understanding of the local circumstances," Akay told Bloomberg News. "It reminds us that when you are going into emerging markets, you definitely want to know the local conditions and have a local network."

Akay, who worked at HBK Investments and Goldman Sachs Principal Strategies before joining SAC, said he would restrict inflows when Carrhae has reached $500 million in assets under management. And he's hoping that a sizeable chunk of that will come from the Blackstone Group.

Carrhae, which has a six-member team, including two other former SAC traders, is in advanced talks with Blackstone about the latter providing seed capital, Bloomberg reports. Akay would not confirm those talks.

Blackstone, which has raised almost $2.5 billion for its second seeding fund, generally provides between $100 million and $150 million to the hedge funds it backs. Among those firms that have won Blackstone's millions are those founded by Credit Suisse Group, Citadel Investment Group and Pershing Square Capital Management veterans.

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    One of the most unique charity benefits in the hedge fund industry, A Leg To Stand On's (ALTSO's) Hedge Fund Rocktoberfest - NYC, raised nearly $500,000 last Thursday thanks to the generous support of major sponsors and nearly 1,400 attendees from the Tri-State finance, business and hedge fund communities. Read more…