Former Brevan Howard wunderkind Chris Rokos is about to strike out on his own.
Forty-four-year-old Chris Rokos, a trader who earned $4 billion in profits for a Brevan Howard macro fund between 2004 and 2012, is ready to spread his wings with well over $500 million in seed capital. He founded his new firm, Rokos Capital Management, in early spring this year after concluding a legal tussle with his ex-employer.
Rokos Capital is expected to launch within the next two or three months, according to knowledgeable sources, assuming approval by regulatory agencies. The firm has a fund raising target of $3 billion for the macro hedge fund.
Macro funds bouncing back this year
Rokos seems to be launching at a good time, as macro hedge funds are finally bouncing back after a couple of years of weak returns. According to data from fund tracking firm Eurekahedge, investors ponied up over $4.3 billion in the first half of the year to put into macro funds after yanking out $14 billion last year.
Macro hedge funds bet on assets including stocks, currencies, bonds, commodities and indexes based on macroeconomic factors, so they generally profit if the investment team correctly projects a regional or sector trend. Macro funds were up 3.2% through the first seven months of 2015. Of note, that was the sector’s best seven-month return since 2012.
More on Rokos Capital
According to inside sources, the majority of the $500 million plus invested to date in Rokos Capital Management will be initially allocated by Rokos, who is planning to focus on foreign exchange, fixed income and equity index products in developed markets and liquid emerging markets.
The firm will also employ two portfolio managers: Stuart Riley, the former Goldman Sachs co-head of Asia Pacific macro trading, and former Brevan Howard trader Borislav Vladimirov, who was most recently employed at Graticule Asset Management Asia.
The source notes that each of the portfolio managers will also run money both by themselves and together with Rokos. The team will also have two assistant portfolio managers, Nick Dawson and Jian Chao Wu. The overall headcount for the firm will be close to 50.