John Tormondsen, the former head of liquid capital markets at Goldman Sachs, and Raif Ezratty, the former head of fixed-income trading at high-profile hedge fund Moore Capital, are in the process of raising capital for a hedge fund called Zpoint Advisors. Ezratty, reached on his cell phone, says "if it's in the document, it's true," referring to an offering circular for the new fund. A portion of the offering circular was read to BondWeek by potential investors in the fund who had received it. Ezratty declined further comment. Tormondsen, known as "Turbo" for many years, did not return a call by press time last Friday morning. The fund, says hedge fund pros who have the offering circular, will be relative value in scope, albeit with a directional component.
Individuals in the hedge fund community who have the marketing circular say Ezratty and Tormondsen have no shortage of ambition for their fund as they are asking for a minimum of $5 million in capital and a one year "lock up" period from each investor. The two have retained Goldman Sachs to assist in capital raising, with several hedge fund capital specialists speculating that the fund would seek to raise a minimum of $500 million, given the fact that there is a directional component to their stated investment strategy. Their fees will be 1.5% of assets under management and 20% of profits. Goldman will also provide prime brokerage services, according to the document.
One statement in the marketing document that caught several in the hedge fund sector by surprise is the fact that Tormondsen, who was a partner at the time of Goldman's initial public offering, and is said to retain a substantial equity stake in the firm, is investing $3 million of his own capital. One individual says that it is very unusual for "a new or potential manager not to have a large part of their net worth invested in the fund"--noting that his personal wealth far surpasses that figure. Ezratty is also investing $3 million, according to the marketing document.
Ezratty and Tormondsen are said to have first become acquainted at Goldman Sachs, where Ezratty was a proprietary trader from 1987 to 1991, before joining Moore, which he left in 1995.