San Francisco-based Tricera Capital is considering purchasing equity derivatives to hedge the firm's recently launched Tricera Asia Fund, which is expected to hit assets of USD5-10 million in the coming months. Raymond Lin, founder, said the firm is looking at buying out-of the-money puts on Asian indices for the long/short fund, which would offer diversified protection on stock volatility.
The hedge fund is particularly interested in derivatives referencing the Taiwan Stock Exchange, which offers attractive pricing, he said. Purchasing out-of-the-money calls is also a consideration, he added.
UBS is prime broker for the fund, but Tricera may shop around for best execution of derivatives trades.
