New York (HedgeCo.Net) – Multi-strategy hedge fund manager, Deimos Asset Management LLC, is launching operations of its new hedge fund management business. Ontario Teachers’ Pension Plan is an anchor investor in Deimos’ multi-strategy product through a managed account platform, the Wall Street Journal reports.
Ares Management, L.P., a leading global alternative asset manager, has also made a strategic investment in the company. Deimos was formed through a management buyout of Guggenheim Global Trading, LLC, the former multi-manager, multi-strategy hedge fund platform of Guggenheim Partners.
Deimos is led by Patrick Hughes and Loren Katzovitz, former co-heads of Guggenheim Global Trading, and Mark Standish, a former Group Executive of Royal Bank of Canada and Co-CEO of RBC Capital Markets, as Managing Partners. Deimos is focused on the development of a suite of alternative asset management products, which is expected to include a multi-strategy hedge fund, along with a wide variety of individual hedge fund strategies. Deimos launched its operations with nine investment strategies focusing initially on the U.S. and Europe with plans to expand into additional markets over time.
“Having known the partners of Deimos professionally for many years, we are excited to work with this team to enter the large and rapidly growing hedge fund asset class, which represents 30% to 40% of all alternative investments today,” said Michael Arougheti, Co-Founder and President of Ares. “We believe we can create value with this strategic partnership by cross selling its hedge fund advisory services to our global investor base. This is a natural extension of our firm’s continuing diversification across alternative asset classes, which we believe enhances our value proposition to our investors.”
“We could not be more pleased to be working with Ares and to have Ontario Teachers’ as an anchor investor,” said Loren Katzovitz, one of Deimos’ Managing Partners. “Ares possesses a world-class distribution and marketing team which will be invaluable to us as we expand our hedge fund offerings. We look forward to building this business and executing on what we see as a very large opportunity within the hedge fund space.”
Deimos’ business plan provides meaningful advantages in light of changing conditions in the hedge fund industry. With its institutional-quality infrastructure and ability to pool resources for multiple managers, Deimos provides institutional-grade operational, compliance and technology resources to mitigate the significant challenges that new and smaller funds face, including increasingly challenging regulatory requirements. In addition, the Deimos platform allows investors to streamline the expense and time cost of due diligence by allowing investors the flexibility to access multiple high-quality investment teams through a single relationship.
The three Managing Partners of Deimos have extensive experience in the investment industry and have worked together in prior organizations. Loren Katzovitz and Patrick Hughes were Managing Partners in Guggenheim Partners, where they built Guggenheim Advisors, the firm’s managed account platform which was later sold to the Bank of Ireland. Mr. Katzovitz and Mr. Hughes more recently built Guggenheim Global Trading. Mark Standish, a former Group Executive at Royal Bank of Canada and Co-CEO of RBC Capital Markets and RBC Investor and Treasury Services, oversaw a wide range of businesses at RBC, including the proprietary trading business. Mr. Katzovitz and Mr. Standish previously worked together, beginning in the mid-1980s at Bankers Trust Company in London, with Mr. Hughes joining them in the early 1990s, and at RBC, where Mr. Katzovitz and Mr. Standish co-headed the global equity derivatives and proprietary trading business from 1995 until 2002. In addition, several members of senior management of Ares were also colleagues of Mr. Standish at RBC.
