Brevan Howard

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Brevan Howard
Type Private
Industry Investment management
Founded 2002 (2002)
Founder(s) Alan Howard
Headquarters Jersey
Products hedge funds
AUM $40 billion
Website brevanhoward.com

Brevan Howard (Brevan Howard Asset Management LLP)[1] is a European hedge fund management company based in Jersey with its funds domiciled in the Cayman islands.[2] The company was co-founded by Alan Howard and four others in 2002.[3][4] It has been described as the largest "macro hedge fund" in the world[5][6] with $40 billion in assets under management (AUM) as of October 2013.[7][8]

History[edit]

Brevan Howard was co-founded in 2002 by five "fixed-income traders from Credit Suisse":[9] Alan Howard,[2][dead link] James Vernon, Jean-Philippe Blochet, Chris Rokos, and Trifon Natsis.[3][10] The company name was created by utilizing portions of the last names of the co-founders.[11] Blochet took a "sabbatical" in 2008, returned and left the firm again in November 2009.[12] Vernon left his position as chief executive officer (CEO) in 2011 but returned to the company as group chief operating officer (COO) in September 2013.[13][14] Another co-founder, Rokos, retired from the company in 2012.[13][15] The company received $2 billion to manage in the global macro fund from Credit Suisse Private Bank. Under the leadership of Brevan Howard's founding partner, assets grew to $10.5 billion in 2006.[16] The company generated a 25% return in 2007 and returns from their global macro fund continued to perform well during the financial crisis of 2008.[16]

In 2010, the company moved its headquarters from London to Geneva.[9] In July 2012, the firm opened an affiliate firm in New York called Brevan Howard U.S. Investment Management LP which had about $800 million in assets under management.[9] Brevan Howard established Brevan Howard Capital Management LP on the island of Jersey.[when?][17] As of June 2013 it was reported to be the largest European hedge fund management firm based on its total AUM.[4][17] An April 2013 article in the Financial News described the company as "the biggest and best-performing [hedge fund management] firm in Europe".[3]

Investment products and strategies[edit]

As a macro hedge fund the company aspires to profit as a result of "broad economic trends" and trades many types of assets including commodities and currencies.[17][17] According to founding partner, Nagi Kawkabani, the firm's overall strategy is focusing on "near-term opportunities" and establishing investment positions that are maintained for one to six months.[16]

The firm manages 11 funds [18] including the Brevan Howard Master Fund (BHMF) 2003, Brevan Howard Multi-Strategy Master Fund Limited (BHMS) 2008, Brevan Howard Emerging Markets Strategies Master Fund Limited (BHEMS) 2007, Brevan Howard Credit Catalysts Master Fund Limited (BHCC) 2009, the Brevan Howard Asia Master Fund Limited (BHA) 2004,[4] the Brevan Howard Emerging Markets Local Fixed Income Fund (BHEML),[19] Brevan Howard Credit Catalysts Master Fund Limited ("BHCC"), [20] Brevan Howard Commodities Strategies Master Fund Limited ("BHCS"), [21] Brevan Howard Systematic Trading Master Fund Limited ("BHST"),[22] Brevan Howard Credit Value Master Fund Limited ("BHCV"),[23] Brevan Howard CMBS Master Fund Limited ("BHCMBS"),[24] Brevan Howard Investment Fund II - Macro FX Fund Limited ("BHMFX"), [25] The company also manages three closed-ended feeder funds, listed on the London Stock Exchange. They are: BH Global Limited (BHMG), BH Macro Limited (BHGG)[26] and Brevan Howard Credit Catalysts Limited (BHCC).[27]

Its flagship fund, the Brevan Howard Master Fund Ltd., had a $28 billion AUM as of October 2013.[8] The fund had a 6% loss in 2011 and a 14% gain in 2012. As of 2013, the fund had averaged a 12 percent annual gain since its inception in 2003.[8][17][28] In 2012 the fund was capped at $25 billion AUM and closed to new investors.[16] In 2013, the fund was reported to be the 11th most popular hedge fund amongst institutional investors in the U.S.[8]

Corporate affairs[edit]

Brevan Howard describes itself as a "global alternative asset manager" and maintains offices in London, Geneva, St. Helier, Hong Kong, Tel Aviv, Washington and New York.[29] The company employs more than 430 people worldwide with 28 employees in its New York office[8] and more than 40 employees at its offices located on the island of Jersey.[13][16][30] Eighty of its employees are traders[18] that receive commissions equal to "11% to 17% of gains."[3] This segment of the employee base includes 15 traders who work at the company's Ramat Gan, Israel office[31] with 38 traders being added to the "global team" of employees in 2012.[3] According to one of the company's founding partner's, "high turnover is part of the business model" and traders are "cut" if they do no perform up to the company's standards for success.[11][16] According to one investment consultant, "It's a very mercenary [corporate] culture.” [4] Brevan Howard's standards for success in trading are so high that some traders who have been dismissed from Brevan Howard "have become stars at other firms."[11] Geraldine Sundstrom, joined the company in 2007 and is a company partner and portfolio manager for the Brevan Howard Emerging Markets Strategies Master Fund Limited.[8][32]

Brevan Howard has made a variety of philanthropic contributions to the Imperial College Business School (ICBS). The company donated £20.1m over eight years to fund a financial economics research centre.[33] As of 2013 the firm had donated £1.5m to ICBS's, Alan Howard Scholarships for Energy Futures.[33] In 2012, BrevanHoward pledged a £250,000 donation to the ARK Bentworth PrimaryAcademy.[34]

See also[edit]

References[edit]

  1. ^ Teitelbaum, Richard (12 Jan 2012). "Brevan Howard Proves Master of Hedge Funds With Four in Top 100". Bloomberg. 
  2. ^ a b Griffiths, Tony (6 October 2010). "The HFMWeek 50 most influential people in hedge funds". HFMWeek. Retrieved 5 August 2011. 
  3. ^ a b c d e "Alan Howard". Financial News. 2 April 2013. 
  4. ^ a b c d McIntosh, Bill (July 2012). "Europe 50". The Hedge Fund Journal. 
  5. ^ Jones, Sam (16 July 2013). "Return of the blueblood macro hedge funds". Financial Times. Retrieved 20 September 2013. 
  6. ^ Moodley, Kiran (1 Sep 2011). "How have hedge fund elite fared in the summer turmoil?". Citywire Wealth Manager. 
  7. ^ Laurence Fletcher (19 March 2013). "Faith in policymakers may be "serious error": Brevan Howard". Reuters. 
  8. ^ a b c d e f Goldstein, Matthew and Ablan, Jennifer and Wachtel, Katya (10 October 2013). "Top global hedge fund Brevan Howard takes emerging markets hit". Reuters. Retrieved 18 October 2013. 
  9. ^ a b c Callahan, Neil and Westbrook, Jesse (12 Oct 2012). "http://www.bloomberg.com/news/2012-10-12/brevan-howard-said-to-consider-leasing-new-london-office-space.html". Bloomberg News. Retrieved 27 September 2013. 
  10. ^ Bill McIntosh (July 2012). "Europe 50". The Hedge Fund Journal. 
  11. ^ a b c Teitelbaum, Richard and Cahill, Tom (31 March 2009). "Brevan Howard Shows Paranoid Survive in Hedge Fund of Time Outs". Bloomberg. Retrieved 7 October 2013. 
  12. ^ "Co-Founder of Brevan Howard to Leave Firm," The New York Times Dealbook
  13. ^ a b c Brewer, Kirstie (5 Sep 2013). "Vernon returns to Brevan Howard". HFMweekonline. 
  14. ^ Jones, Sam (25 July 2011). "Brevan Howard co-founder to leave firm". Financial Times. 
  15. ^ Westbrooke, Jesse (17 Aug 2012). "Brevan Howard Loses Third Founder as Rokos Said to Leave". Bloomberg. 
  16. ^ a b c d e f Williamson, Christine (1 October 2012). "Brevan Howard attracting institutions". Pensions & Investments. 
  17. ^ a b c d e Westbrook, Jesse (5 Sep 2013). "Brevan Howard Co-Founder Vernon Returns After Two Years". Bloomberg. Retrieved 6 October 2013. 
  18. ^ a b "Alan Howard: Hard work pays off for ‘the Stakhanov of finance". Financial News. 2 Apr 2013. 
  19. ^ Bill, McIntosh (March 2013). "Brevan Howard Emerging Markets Local Fixed Income Fund". The Hedge Fund Journal. 
  20. ^ Brevan Howard Proves Master of Hedge Funds With Four in Top 100 - Bloomberg
  21. ^ Brevan Howard Opens Its $200 Million Energy, Commodities Fund to Investors - Bloomberg
  22. ^ Brevan Howard Systematic Trading Master Fund: BH-DG Systematic Trading - Risk.net
  23. ^ Brevan Launches New Credit Fund With $20M Minimum | FINalternatives
  24. ^ Brevan Howard Buying CMBS Sees 60% Gains for Teachers: Mortgages - Bloomberg
  25. ^ Morningstar Global Documents
  26. ^ Smith, Justin (11 November 2008). "BH Global and BH Macro announce secondary listing in Dubai". Business Intelligence Middle East. 
  27. ^ Chandler, Beverly (9 November 2011). "BHCC offers listed diversification in difficult markets". Opalesque. Retrieved 13 March 2014. 
  28. ^ Taub, Stephen (25 January 2013). "After tepid 2012, Brevan Howard founder forecasts strong year for macro funds". Institutional investor's Alpha. 
  29. ^ Unknown author (Unknown date). "Brevan Howard". Brevan Howard. Retrieved 27 September 2013. 
  30. ^ Westbrook, Jesse (20 November 2012). "Brevan Howard on Hiring Spree Makes Comeback in New York". Bloomberg. Retrieved 27 September 2013. 
  31. ^ Eytan Avriel (22 February 2010). "The way the big boys bet". Haaretz. 
  32. ^ Unknown author,Milken Institute, Biography, Retrieved 13 March 2014
  33. ^ a b Bradshaw, Della (11 March 2013). "Brevan Howard gives £20.1m to Imperial College". Financial Times. 
  34. ^ "Headmaster as Chair of the Local Governing Body of ARK Bentworth Primary Academy". cityoflondon.gov.uk website. 19 June 2012. 

External links[edit]