Episode 14: How to scale your hedge fund’s AUM beyond 100 million? Institutional FX: Uncensored
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- Investing
90% of hedge funds don’t raise more than $100m ever. So how to overcome and scale beyond that? What is the reason for this AUM plateau? Natallia Hunik discusses challenges of fundraising for a hedge fund with Laurence Yang, overachiever and successful hedge fund manager from Australia.
Guest:
Mr. Laurence Yang, an Australian resident, founded Laurence Holdings Group Limited in 2017 as a private investment holding company to manage investments for himself and Ultra-High-Net-Worth-Individual partners’ Single-Family Offices. Laurence has started his first fund in 2014, and in less than 2 years, by the end of 2015, Mr. Yang had generated over 50% return for his investors. Mr. Yang was able to start Laurence Holdings later with this successful track record.
In 2017, Mr. Yang formed Laurence Holdings Group Limited to serve as the corporate investment vehicle for its early investors. The company started the flagship Euro-Denominated Fund with a Net Asset Value (NAV) of €15.5 million in November 2017, by the end of May 2021, the fund has a total NAV of over €49 million.
Highlights for discussion:
1. As an incredibly young and accomplished fund manager as well as a “millennial”, Laurence shared his incredible story about how he started in the FX Hedge Fund space;
2. With interest rates fixed at record lows, investors are looking for higher returns more than ever. In fact recent report by Hedgeweek shows record AUM of 4 trillion dollars as investors fear inflation and flock into alternative spaces. Will hedge fund investors grow their risk appetites as a consequences of low rates and rising inflation? Laurence shared his opinion.
3. What type of FX strategy did Laurence deploy? With Carry Trade gone, many FX funds exited the space or shut their active currency strategies down. Laurence Holdings Group Limited however thrived in this environment. What type of currency investment strategies did the company apply and what made it a success?
4. 90% of hedge funds don’t raise more than $100m ever. So how to overcome and scale beyond that? What is the reason for this AUM plateau?
5. At FXHedgeFundExpo 2020, participants from the space noted lack of traders as a reason preventing them from implementing FX strategy into their fund. Laurence shared his opinion on this poll;
6. Investors’ biggest fear is preserving their investment during periods of extreme volatility. Currency markets are very prone to rapid market moves (whether its algo driven flash crashes, or central banks policy decisions). As noted by attendees during FXHedgeFundExpo 2020, risk management remains their most important criterion when selecting strategy. What time of risk management did Laurence employ to mitigate extreme vol risks?
7. Fundraising is one of the biggest challenges to launch the fund. HF managers cited lack of personal network as the major worry when launching their own fund. How important is the personal network? What are the most effective ways to raise capital?
8. What does Laurence plan to do in the next 5-10 years? What he might invest and what books he recommends for hedge fund managers? Also, what are the skills or qualities for a hedge fund manager?
90% of hedge funds don’t raise more than $100m ever. So how to overcome and scale beyond that? What is the reason for this AUM plateau? Natallia Hunik discusses challenges of fundraising for a hedge fund with Laurence Yang, overachiever and successful hedge fund manager from Australia.
Guest:
Mr. Laurence Yang, an Australian resident, founded Laurence Holdings Group Limited in 2017 as a private investment holding company to manage investments for himself and Ultra-High-Net-Worth-Individual partners’ Single-Family Offices. Laurence has started his first fund in 2014, and in less than 2 years, by the end of 2015, Mr. Yang had generated over 50% return for his investors. Mr. Yang was able to start Laurence Holdings later with this successful track record.
In 2017, Mr. Yang formed Laurence Holdings Group Limited to serve as the corporate investment vehicle for its early investors. The company started the flagship Euro-Denominated Fund with a Net Asset Value (NAV) of €15.5 million in November 2017, by the end of May 2021, the fund has a total NAV of over €49 million.
Highlights for discussion:
1. As an incredibly young and accomplished fund manager as well as a “millennial”, Laurence shared his incredible story about how he started in the FX Hedge Fund space;
2. With interest rates fixed at record lows, investors are looking for higher returns more than ever. In fact recent report by Hedgeweek shows record AUM of 4 trillion dollars as investors fear inflation and flock into alternative spaces. Will hedge fund investors grow their risk appetites as a consequences of low rates and rising inflation? Laurence shared his opinion.
3. What type of FX strategy did Laurence deploy? With Carry Trade gone, many FX funds exited the space or shut their active currency strategies down. Laurence Holdings Group Limited however thrived in this environment. What type of currency investment strategies did the company apply and what made it a success?
4. 90% of hedge funds don’t raise more than $100m ever. So how to overcome and scale beyond that? What is the reason for this AUM plateau?
5. At FXHedgeFundExpo 2020, participants from the space noted lack of traders as a reason preventing them from implementing FX strategy into their fund. Laurence shared his opinion on this poll;
6. Investors’ biggest fear is preserving their investment during periods of extreme volatility. Currency markets are very prone to rapid market moves (whether its algo driven flash crashes, or central banks policy decisions). As noted by attendees during FXHedgeFundExpo 2020, risk management remains their most important criterion when selecting strategy. What time of risk management did Laurence employ to mitigate extreme vol risks?
7. Fundraising is one of the biggest challenges to launch the fund. HF managers cited lack of personal network as the major worry when launching their own fund. How important is the personal network? What are the most effective ways to raise capital?
8. What does Laurence plan to do in the next 5-10 years? What he might invest and what books he recommends for hedge fund managers? Also, what are the skills or qualities for a hedge fund manager?