Hong Kong hedge fund Torq Capital winds down as founder heads for Citadel

Citadel Income Fund

15/01/2024 03:37

By Summer Zhen
       HONG KONG, Jan 15 (Reuters) - Hong Kong-based hedge fund
Torq Capital Management is closing up shop after more than seven
years of operation and its founder and chief investment officer,
Avinash Abraham, will move to Citadel, the companies said.
    The market-neutral fund focusing on Asian equities was
founded in 2016 by Abraham, former head of Asia for Balyasny
Asset Management and a former portfolio manager at Citadel,
which is among the world's biggest and most profitable hedge
funds.
    Torq, seeded by Alibaba co-founder Joe Tsai's family office
Blue Pool Capital, grew to manage more than $1.5 billion at its
peak.
    "Torq has commenced an orderly wind down of its operations
and will return capital to investors over the next few months,"
Torq Chief Operating Officer Kendall Johnson said in a statement
on Friday. Bloomberg News first reported Abraham's departure and
the Torq's planned closure.
    Abraham will join Citadel's Asia fundamental equities team
as portfolio manager later this year, Citadel said in a separate
statement. Citadel has tripled its headcount in Asia since 2019
to about 200 employees.
    The liquidation of the Torq flagship fund began last week
and some staff are expected to join Abraham at Citadel, a source
familiar with the matter said. Torq and Citadel did not respond
to a request for comment on plans involving Torq staff.
    The high interest rate environment has driven investors to
demand double-digit returns from hedge funds, while an
intensifying talent war among multi-manager hedge fund platforms
has squeezed smaller funds.
    "It is certainly true that talent is harder to get these
days, and that there is a limited pool of talent," said Patrick
Ghali, managing partner of hedge fund advisory firm Sussex
Partners.
    Torq had annualised returns around 10% through October 2021
but the subsequent two years were roughly flat, with the
flagship fund gaining 1.1% in 2023.
    Citadel's flagship Wellington fund rose 15.3% last year,
outpacing the bond markets.

 (Reporting by Summer Zhen; Editing by Edmund Klamann)
 ((summer.zhen@thomsonreuters.com; 852-3462-7739;))