LAUSANNE, Switzerland (HedgeWorld.com)–Banque Cantonale Vaudoise plans to launch its first hedge funds of funds for private bank clients in early 2003 with the help of its Miami-based PRS Group.
The fourth largest bank in Switzerland, BCV owns a shareholder stake in PRS, which is an alternative investment management firm specializing in hedge funds of funds and structured notes. The U.S. firm will be working closely with Jose Galeano, who is charge of the bank’s alternative investment effort in Switzerland.
“The idea is to create synergies in terms of research,” Mr. Galeano said. The two offerings will be structured under an umbrella fund, the BCV Alternative Fund, and listed on the Swiss Stock Exchange. Officials at BCV are now in the process of registering the funds with the Swiss authorities in order to offer the funds publicly. The distribution of the fund will be done by another BCV entity, Gerifonds.
The underlying hedge funds of funds will be the Defensive Fund and the Directional Fund. The Defensive Fund will invest in arbitrage strategies in a low beta and low volatility program. The Directional Fund will take a more aggressive approach as a relative value fund investing in long/short equity and other directional strategies. The funds will likely be available to investors by the end of January.
According to Mark Casa, director of investments at PRS, the funds are likely to raise at least US$100 million or somewhere in the range of 150 million and 200 million Swiss Francs. Two Harvard Business School graduates, John Sullivan III and Gonzalo Rodriguez-Fraile founded PRS in 1981. The firm, which traditionally has done business mainly in Europe, hopes to be active in U.S. institutional marketplace as well.