Global-Macro Startup Emphasizing China
A global-macro startup with a China-centric view is set to start trading a sizeable sum of outside capital at the end of the second quarter.
Hong Kong-based PrideRock Global Investment, led by one-time Goldman Sachs executive Jun Yuan, began trading in January with internal capital and went on to post a 16.5% gain as of March 31. The plan is to have at least $100 million on hand when the operation begins investing for clients.
PrideRock subsequently would seek to bring the total to $150 million to $250 million in short order, and then develop a track record before pursuing a broader expansion. Sources said the firm already has secured backing from limited partners in Asia and the U.S., drawing in part on its team’s experience in China’s financial market.
One potential investor called the operation “one of the more interesting launches I’ve seen lately.”
PrideRock deploys capital with an eye toward the effects of China’s status as an economic superpower and its central role in the global supply chain. The idea, in part, is that the nation’s influence over financial-product values worldwide will grow in the wake of the coronavirus crisis.
PrideRock’s approach begins with a quantitative probe of about 200 stocks of companies with exposures to China, including those in Hong Kong and the U.S. The firm’s algorithms then automatically narrow down that group to a few dozen and trades them automatically, with Yuan and his team applying discretionary overlays to further screen market trends.
Though the portfolio is weighted toward equities, Yuan and his team seeks to profit via directional bets on products including currencies, fixed-income instruments and commodities. A further volatility component automatically trades equity futures on a short-term basis.
PrideRock will have a six-person investment team in place when it launches. Yuan, who holds the title of chief investment officer, most recently co-headed the asset-management arm of Hong Kong investment-banking firm TianFeng Securities from 2017 to 2019. He was at Goldman Sachs before that, running nearly $2 billion of assets in Asia. He also has spent time as a macro trader at Morgan Stanley.
Also on board as a founding partner is chief trader Jing Liu, who most recently was at quantitative hedge fund operator Genesis Capital from 2017 to 2019. Liu also has worked at J.P. Morgan and Morgan Stanley.
Drew Brick is PrideRock’s president. He previously was chairman of TianFeng affiliate TF International Holdings. Kenny But, who last oversaw operations at Ayres Capital, is head of operations and compliance.
PrideRock’s algorithms draw on research from the computer-science department at Peking University, where Yuan and Liu studied.