Citigroup, JPMorgan Vets Launch Macro Fund

Jul 21 2009 | 7:05am ET

New York-based TKNG Capital Partners has launched a global macro hedge fund and is on the fundraising trail for its maiden offering.

The TKNG Global Investment Fund is the brainchild of partners Neil Grossman, formerly of JPMorgan Chase and Five Mile Capital Partners, and Ken Tremain, formerly of Citigroup. The firm kicked off its marketing efforts last month after launching the fund in March. Global Investment is up 8.25% as of last Friday, according to a source familiar with the offering, and manages some $5 million in total assets.

The fund invests primarily in the currency and interest rate markets, as well as equity indices and commodities. Tremain formerly served as Citi’s head of North American interest-rate trading and fixed-income derivatives trading, while Grossman served as a senior trader at Five Mile, a $2.8 billion alternative investment shop specializing in real estate, debt products, structured finance, asset-based lending and financial services.

The fund is just one of many new macro funds trying to find their way into investors’ portfolios given the recent struggles of commodity trading advisers, last year’s darlings of the hedge fund space.

“This is a great environment for global macro funds and I think more people are looking at it,” said the source. “Commodity trading advisers have been great but you could almost argue that the major trends were in place last year and CTAs are struggling now so investors are looking more for discretionary macro managers.”

The fund charges a 1.5% management fee and a 12.5% performance fee for returns up to 15% and 25% for returns over 15%. The minimum investment requirement is $250,000.

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