JPMorgan Chase & Co.'s former global head of equity finance and three other bankers have started a London hedge-fund firm, as they try to profit from Europe's economic recovery.
Andrea Angelone, who spent 20 years at JPMorgan, and Amit Jain, previously an equity derivatives trader for the New York- based bank, both left last year to start a hedge fund with Simone Russo, a former Goldman Sachs Group Inc. managing director, and Guido Miani, previously a fixed-income trader at UBS AG. The firm, Amagis Capital Ltd., will invest in companies pursuing acquisitions, share buybacks and other transactions, hoping to benefit from an increase in corporate activity as Europe's sovereign debt-crisis fades.
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"There is an opportunity right now in the European market to deliver superior returns because of recovering activity," Angelone, Amagis' chief executive offer, said in an interview. "After many years on the sell side we have the experience and knowledge to be able to deploy a slightly different approach in the event-driven space."
A growing number of traders have left banks for hedge funds since the collapse of Lehman Brothers Holdings Inc. in 2008 prompted regulators to try to limit risk-taking by lenders. Banks including JPMorgan shut proprietary trading desks after the U.S. Congress approved the Dodd-Frank Act in 2010, which restricts lenders from using their own capital to make bets on stocks and bonds.
"There is a gap that we can capitalize on" with banks moving away from proprietary trading, Angelone said.
Amagis will begin trading May 1 with $35 million from six investors, Angelone said. The firm, which plans to open an office in Monaco, seeks to manage $100 million by the end of 2014 and $500 million in three years., he said.
Deepak Gulati, a former head of global equity proprietary trading at JPMorgan, begin investing at his hedge-fund firm last June after raising about $300 million. Argentiere Capital AG, based in Zug, Switzerland, focuses on volatility trades, betting on the rate at which stocks rise or fall.