Startups Offset Growing Number of Closures

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Stockholm (HedgeNordic) – Fund closures and startups are an integral part of any hedge fund industry’s evolution. The number of Nordic hedge funds declined severely in 2019 as a result of 29 closures and fewer startups. The number of active funds remained relatively stable so far in 2020, as four new launches offset a growing number of closures.

Chart by Visualizer

In the Nordic hedge fund universe, a total of seven funds closed down or are in the process of closing down so far this year. Announced in late March, the liquidation of Swedish hedge fund manager Bodenholm Capital is the highest-profile closure in the Nordics this year. DNB Asset Management has liquidated DNB ECO Absolute Return, a market-neutral equity fund focused on the renewable energy and energy efficiency sectors, due to its small size and unsatisfactory performance.

Northern Star MG Relative Value, which employed commodity option trading strategies, was closed down in January this year. Multi-asset, multi-strategy fund Pacific Multi Asset was merged into Pacific Precious at the end of March. Norwegian Espen Westeren said earlier this year that his Titan Opportunities Fund was shutting down. SEB Alternative Fixed Income, a macro and relative-value hedge fund, has also been put into liquidation. Most recently, London-based International Asset Management (IAM) announced the decision to liquidate its Nordic-focused fund of hedge funds, IAM Nordic Multi Strategy Fund.

Although the rate of closures picked up last year and continues into 2020, there are always infusions of fresh blood in the Nordic hedge fund industry. DNB Asset Management launched a multi-strategy, multi-asset absolute return fund – DNB Fund Multi Asset – in February. Stefan Åsbrink partnered with Coeli Asset Management to launch global long/short equity fund Coeli Multi Asset on the last day of December.

Frost, a fixed-income-focused relative value fund managed by former employees at the now-closed Nektar, was launched at the beginning of January. Finnish asset manager Northern Star Partners also launched trend-following fund NS Quant shortly before the coronavirus-induced market turmoil.

The four new launches performed strongly during the turbulent first quarter of 2020. NS Quant, for instance, gained a cumulative 11.6 percent in February and March. Frost was down a mere 1.2 percent in the first quarter, while Coeli Multi Asset was up 0.2 percent during the three-month period ending March. DNB Fund Multi Asset, meanwhile, was down about five percent in the first quarter.

Photo by ian dooley on Unsplash

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Eugeniu Guzun
Eugeniu Guzun
Eugeniu Guzun serves as a data analyst responsible for maintaining and gatekeeping the Nordic Hedge Index, and as a journalist covering the Nordic hedge fund industry for HedgeNordic. Eugeniu completed his Master’s degree at the Stockholm School of Economics in 2018. Write to Eugeniu Guzun at eugene@hedgenordic.com

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