New Fund Focusing on Volatility-driven Valuation Anomalies

As reported in a recent Asian Investor article, CQS has launched the CQS Global Volatility Fund. The fund is beginning with AUM of $160 million and has a strategy that tries to profit on equity volatility valuation anomalies within market indices and on market dislocations, including the volatility of individual global equities. Not surprisingly, the fund will rely on options and futures to take positions in the volatility-driven valuation anomalies. CQS had previously launched an Asian convertible arbitrage hedge fund in 2007 that focused on convertible bond and equity strategies in Asia, also with a global volatility bias. Whether this is yet another sign that volatility has peaked, as is often the case when new funds chase the next new thing, is yet to be seen.