Maymin: Can Campaign and Manage Funds Too

GREENWICH, Conn. (HedgeWorld.com)--Maymin Capital Management LLC is a father and son hedge fund management firm.

The father is Zak Maymin, who came to the United States with his family from Russia (then still part of the Soviet Union) in 1980.

"He got his Ph.D. in math from the Massachusetts Institute of Technology in one year," soon thereafter, said his proud son, Phil Maymin.

Prior to launching their own hedge fund shop, Phil and Zak both worked at Ellington Management Group LLC from November 2000 to November 2004. They ran the equity derivatives and statistical arb desks.

Before that, Phil was a strategist at the now-notorious Long-Term Capital Management, 1997 to 1999.

Phil Maymin described Maymin Capital's strategy as "behavioral relative value." A standard "relative value" strategy, he explained, makes the assumption that everything moves toward equilibrium, that diverging values will converge. That was the ruling assumption of LTCM.

A behavioral relative value strategy, on the other hand, "looks for the behavioral story that will explain why and when things will move toward equilibrium," he said.

Phil Maymin also is currently running as the Libertarian Party's nominee for the House of Representatives seat in Connecticut's Fourth District against Democrat Diane Farrell and Republican Christopher Shays, the incumbent. He said that he can campaign for office and manage hedge funds both because "in modern times, you don't have to be out on the road shaking hands 24-7" to campaign effectively.

Did Maymin Capital register with the Securities and Exchange Commission prior to the court order striking down the mandate? Yes, he said.

Has it since deregistered? No. "On advice of counsel it doesn't seem to be the most prudent sort of action," he said. There still may be twists and turns to come in the post-remand legal maneuverings.

As a libertarian, would he abolish the SEC given the chance? It seems not. "The functions that the SEC performs that are related to protecting people's property are valuable functions," he said. But, he added, much that the SEC has been doing of late, "even for the enforcement of fraud, has been unhelpful."

As an example of regulatory excess, he cited the National Market System, or Reg. NMS, in which the SEC prohibits, beginning next year, the execution of an order at one exchange at a price that is inferior to one that could have been obtained at another exchange. Mr. Maymin believes that free competition among exchanges would produce an optimal equilibrium.

As to his campaign, some have expressed concern that he could split the Republican vote, helping Diane Farrell. He doesn't share this concern. "I don't think many people see much of a difference between Shays and Farrell," he said.

CFaille@HedgeWorld.com

Contact Bob Keane with questions or comments at bkeane@investmentadvisor.com.

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