New York-based hedge fund manager Linden Advisors envisages entering into equity, credit and interest-rate derivatives contracts in its Linden Capital Fund, scheduled for launch next month. Joe Wong, founder of Linden, explained the firm will trade two main strategies: volatility arbitrage and capital structure arbitrage. It will use equity derivatives, including puts, calls and warrants, to take positions or for hedging; interest-rate options will primarily be considered for hedging and credit default swaps will be employed for both hedging and as part of the capital structure arbitrage strategy, he said.
Goldman Sachs and Morgan Stanley will share prime brokerage of the fund, while Linden will shop between several derivatives counterparties according to criteria including price and relationship, Wong said.
Wong was previously a proprietary trader at JPMorgan in New York prior to founding the firm last summer along with three former JPMorgan colleagues (DW, 6/23).
