Anthony Faillace and Steven Luttrell, two veterans of BlackRock Financial Management, will launch Drake Management, a new fixed-income hedge fund based in New York. It will launch with $150 million in assets under management, according to Luttrell. Faillace, who was a non-dollar portfolio manager at BlackRock for three years, will be cio, while Luttrell, who was a senior executive in the alternative investment group, will be coo. Prior to their stint at BlackRock, they both worked at PIMCO. Luttrell says the firm will use a multi-sector, low volatility, relative-value approach to investing, and has no target on the amount of capital they want under management.
Luttrell says the firm has been aggressively staffing up, with the hires early last week of Chris Testa and Adam Policastro to head up corporate bond investments. Testa, who had been at Goldman Sachs Asset Management since 1994, and was its head of credit research, will be responsible for high-yield and crossover credits. Policastro was at J.P. Morgan Securities since 1994, where he was co-head of financial institutions research (specializing in non-bank credits) until he left earlier this year after the merger with Chase Manhattan Bank. Policastro will be responsible for investment-grade investments.
Luttrell says that additional hires include Darren Clipston from Sagamore Hill, a convertible arbitrage hedge fund, to head up the dedicated convertible book. Similarly, Adam Kizner, who helped run Long Term Capital Management's financing (or repo) desk, was brought in to run a repo trading operation. He was hired from CDC Investments, where he traded repo agreements. Yuan Shen has been hired to run the firm's investments in mortgage-backed securities, where Luttrell says she will buy both pass-throughs and collateralized mortgage obligations. She comes fromJ.P. Morgan Investment Management.