Nuvest Capital will launch a global multi-asset fund with an emphasis on emerging markets by July with seed money from GIC.
It aims to raise $1 billion by the first year of operations as its founder and Government of Singapore Investment Corp veteran Aje Saigal looks to build his record.
"Our 12-month target AUM is $1 billion but the strategy is very scalable for it to be much larger," said Nuvest's portfolio manager Tanuj Dutt, who set up and led Chicago-based Citadel's Asian equities quantitative research team.
According to Saigal, the traditional buy-and-hold strategy that many funds use will no longer work in the coming years due to high uncertainty and huge volatility in the markets.
"That is going to be more of a permanent feature of the landscape," said Saigal, who is also a consultant at GIC.
"We are now faced with a high degree of uncertainty in the world because of the chronic debt problems in the developed markets, the process of deleveraging and unorthodox monetary measures that are being taken to try and revive growth."
Up to 80 percent of Nuvest's portfolio will be invested in emerging markets as developed economies face stagnating growth and low returns, said Saigal.
Nuvest will manage the fund using a risk parity approach by adding a moderate amount of leverage to its fixed income investments to increase returns.
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