David Schwartz, head of structured products marketing at Dresdner Kleinwort Wasserstein in New York, has left to start a structured credit fund. Schwartz said the fund, dubbed Fairhaven Asset Management, will focus on the senior classes of risk across structured credit products, including synthetic collateralized debt obligations.
Schwartz left DrKW two weeks ago to show his commitment to the project and to avoid any conflict of interest while working at the derivatives house. He said he has spoken with several investors and expects to raise USD50 million in the coming months.
Three other partners will join Schwartz and a fourth will work as consultant, mainly on the modeling side of the fund. Schwartz, who is a former structurer at Chase Manhattan, said the team covers all the areas of credit hedge fund management, including trading, portfolio management and marketing. Fairhaven has yet to sign up to a prime broker, law firm or accountant.
The secondary market in structured credit instruments is the hottest area of the credit derivatives market at the moment, with several banks, including Banc of America Securities (DW, 10/5), Merrill Lynch (DW, 8/3) and Goldman Sachs (DW, 10/12), setting up desks to trade the instruments.
