Boaz Weinstein, founder and manager of Saba Capital and a former Deutsche Bank trader, and Dan Stern, President of Reservoir Capital are joining in to support an upcoming hedge fund firm.
Antoine Cornut has worked for Weinstein at Deutsche Bank, he left the bank last year after working there for almost five years. Antoine Cornut is setting up a hedge fund by the name of Camares Capital, for now there is no information how much Weinstein and Stern have committed as seed investment.
Weinstein’s firm Saba Capital, applies complex algorithms to find trading opportunities in the credit markets. Saba Capital Offshore Fund manages $3.5 billion and was down 3.83 percent last year. However the fund gained 2.24 percent in the new year as of Jan. 18.
Saba Capital started with only $160 million in 2009 and the firm has approximately $5 billion under management. Weinstein’s credit derivatives focused hedge fund made news last year when it was able to price JP Morgan Chase & Co. (NYSE:JPM)’s London Whale fiasco at the right time. Saba Capital gained as much as 16 percent in a single month from these trades in 2012, however the fund incurred losses further into the year which wiped the returns.
Reservoir Capital usually invests in other entities for a share in their business. The seed money is usually locked for 3 years and the the seeding funds can divest off their stake if it is bought by the manager or some outside party.
Cornut applied to register his firm Camares Capital LLP with U.K.’s Companies House back in August of last year. The new fund of Camares Capital will launch somewhere in March of this year after it get approval from U.K.’s Financial Services Authority. Cornut wants to build a portfolio in European Credit and so far his team includes, Julien Marie and Askin Aziz from Deutsche Bank AG (NYSE:DB) (ETR:DBK) and Aravind Chandrasekaran from JP Morgan Chase & Co. (NYSE:JPM).
Weinstein had made a name for himself even before he founded Saba Capital, he produced huge gains for Deutsche Bank AG (NYSE:DB) (ETR:DBK) and was the youngest director at the institution.
Note (2/11/2013): A previous version of this article said that Weinstein and his group at Deutsche Bank lost more than what they earned for the bank, the article has been amended to exclude this information as we have come to know that this was incorrect.