Thursday, 30 October 2014
Last updated 5 hours ago
Jan 2 2013 | 1:39pm ET
One of Joel Salomon's New Year's resolutions was apparently, “Launch a hedge fund,” because the former Citigroup proprietary trader plans to do just that this month.
SaLaurMor Capital, a long-short fund named for Salomon daughters Lauren and Morgan, will be based in New York and focus on small and mid-cap financial stocks—initially insurance companies and asset managers, but eventually the credit of financial firms.
Salomon, who ran a $700 million peak-value stock portfolio within the equity principal strategies group at Citigroup prior to his January 2012 departure, hopes to raise about that amount for his new venture. (Citigroup closed the equity group to comply with looming regulations barring banks from betting their own funds on securities and markets.)
The fund will trade in European, North American and Asian markets.
“Europe clearly has much cheaper valuations than the U.S. but the macro headwinds are much more significant there,” Salomon said. “We found that there’s substantial value in a fair number of European insurance companies. If you look at dark-cloud scenarios, there’s downside in Europe as well,” Salomon told Bloomberg.
SaLaurMor will hold stocks for 12 to 24 months, on average, he said, adding that he sees opportunity in undervalued and overvalued companies and those not affected by interest rates or regulations.
“We’re looking at companies that are not subject to that kind of regulation, like reinsurance companies, and we’re looking at fee-based companies, like insurance brokers. Even in years like 2012, there are some companies down 30 to 50% and others up 50% or more.”
Salomon has hired a senior analyst and said he'll probably add another analyst and an operations manager for the launch.
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