San Diego-based hedge fund manager Context Capital Management plans to enter its first equity options as part of the investment strategy for its USD30 million Context Convertible Arbitrage Fund. Jim Abbott, fund manager, said the fund, which was launched in August, will employ equity derivatives to hedge credit risk on convertible bonds. It may also enter trades where it arbitrages the price of a company's debt versus its equity.
Goldman Sachs is prime broker of the fund and will be the first port of call for the options. Context may, however, shop around for best execution, Abbott said.
