Hedge fund seeding specialist NewAlpha backs G Capital

Date: Monday, June 7, 2010
Author: Hedge Funds Review

The hedge fund seeding specialist NewAlpha Asset Management has made a strategic investment in G Capital Management, a global macro fund manager established in 2009 by former Goldman Sachs managing director Peter Gerhard.

The investment in the G Capital Fund is the 14th seeding deal for Paris-based NewAlpha since it was established in 2003 and its second major investment of 2010.

The G Capital Fund uses a discretionary global macro strategy investing in global rates, currencies, liquid commodities and equity indices. Investment decisions are based on quantitative and fundamental analysis.

The investment team is led by Gerhard and includes former Goldman Sachs alumni Mel Gunewardena and Ian McDonald.

Gerhard launched G Capital after spending more than 20 years at Goldman Sachs. He was named a partner in 1994 and was a member of the bank's risk committee and also a member of the operating committee for its fixed income, currency and commodities business.

He held various senior roles at Goldman Sachs until his retirement in 2006, including global head of foreign exchange and money markets and co-head of emerging markets and global rates.

Gunewardena was also at Goldman Sachs from 1994 to 2006 and was responsible for building the bank's fixed income and foreign exchange prime businesses. He moved to Deutsche Bank in 2006 where he was global head of fixed income and foreign exchange prime brokerage before leaving to team with Gerhard in 2009.

McDonald is a former managing director at Goldman Sachs. He was a member of the strategies group in the fixed income currency and commodity division and head of macro strategies at the bank.

The team also includes James Solano, who spent nine years at Deutsche Bank where he was most recently a director in its institutional client group.

The G Capital Fund was launched in January 2009 and posted returns of over 21% in its first year. The fund was up 5.5% at the end of May 2010 having weathered the recent market turbulence.

The G Capital Fund currently has over $100 million in assets under management.

NewAlpha's recent seed deals have focused on hedge funds established by experienced managers with long track records at large organisations.

Earlier in 2010 it invested $40 million in Armored Wolf, a global macro fund established in 2008 by John Brynjolfsson who previously ran Pimco's real return funds.

NewAlpha also backed Concerto Asset Management, a US corporate credit manager founded by Julie Bouhuys, the former head of credit products at Wachovia.

NewAlpha said it was preparing to launch of another investment vehicle in the second half of 2010 to invest in early stage managers. The company aims to raise $250 million for the fund.