Offshore Hedge Fund Shell Providers?

Discussion in 'Professional Trading' started by 2cents, Dec 10, 2006.

  1. hi guys... offshore-based FX trader here, trading PA + OPM, looking at expanding into futures / options on FX, commodities, indices...

    i had a set-up until now whereby i wld open managed (PoA basis) client accts with a UK-based broker acting as my prime broker. the prime would allow me to trade in bulk on a number of ECNs and allocate P&L to sub-accts on a weightings basis. no extra / hidden etc costs, no need for me to be registered anywhere... the perfect set-up... until recently...

    basically, 6 months ago they started worrying that the FSA might object to me having no registration while receiving significant sums from the prime (disclosed mark-ups) monthly, therefore asked me to move all my clients over to their US sub, and get some sort of registration over there within a year or so... (series 3 sufficient?)

    just a zero-cost paper move but, problem is, post Refco, some of my clients dragged their feet... the prime started harassing them administratively 2 mths ago using AML as an excuse, making ludicrous requests that they shld resubmit all manners of certified / notarized documents just to keep their acct open with the UK house! they balked, some of them withdrew their funds...

    in the end last week, i decided to raise the matter with the FSA and terminate my relationship with this broker altogether, and look for a better set-up

    no intention to set up a fund myself, i have consulted extensively and i do not like the operating costs even for a BVI set up - only got $1-2 mio AUM and could grow to 5-10 but not desirable because of scalability issues with my strategies, and i already get 100x leverage anyway...

    what i am exploring right now is a partnership with an offshore hedge fund shell provider, using a world class custodian (UBS), they handle AML compliance balooney, produce a daily / weekly NAV, handle subscriptions / redemptions, allow me to use the ECNs / brokers of my choosing and switch as appropriate, and allow me to trade the fund via a consulting agreement, and based on THEIR registrations... meaning i can expand into futures etc trading on behalf of clients, without the regulatory hassle... no upfront costs to me, need only CHF1mio AUM to get going, set up takes 2 to 3 weeks since the umbrella structure is already in place, low negotiable custodial-type fees and a fair split of manager collected fees, mark-ups etc that can offset their custodial-type fees... management / performance fee remains 100% to the manager, no split required

    you guys familiar with firms offering similar type of services?
  2. tfuad


  3. thanks but i have already consulted extensively over the years and am fairly familiar with all aspects involved in all relevant jurisdictions, and leading players' standard offerings... now looking for proper and affordable plug-and-play structures allowing the manager to retain total independence and mask his/her trading patterns from all parties involved...

    met these guys in Geneva on weds... all old mkt hands, ex-traders etc... was v.impressed by the set-up, the flexibility and robustness, the business model... they opened up in sept and already have 6 funds live and a sizeable amout of $ at play and growing fast...

    i may actually get involved in promoting them since i believe in the model and they hardly have any competition in that space! any interest, pm me
  4. ananda


    I would be interested in hearing more about your people in Geneva. I am Swiss based and am exploring various options.

    Perhaps you could e-mail me on
  5. thks but this is the run-of-the-mill fund start-up & ongoing assistance offering... nowhere near a plug & play at no upfront costs type solution