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Schumacher, MacBain Start Low-Cost Hedge Fund in Toronto

Date: Tuesday, June 8, 2010
Author: Bloomberg

Two of Canadaís bond market veterans are seeking to raise C$100 million ($94.4 million) for a hedge fund that will invest in debt securities while keeping fees below industry benchmarks, the Globe and Mail reported.

John Schumacher, former co-chief of Scotia Capital, and Mike MacBain, former head of debt capital markets at RBC Dominion Securities, plan to generate returns of 8 percent to 12 percent at Toronto-based East Coast Fund Management Inc., the newspaper said today.

The fundís fees will remain under the industry standard of 2 percent, and a performance fee of 20 percent of any upside will kick in only after the fund has returned at least 4 percent, the Globe said.