Samir Mathur Exploring New Hedge Fund Ideas

Samir Mathur earned an MBA with an emphasis on Quantitative Finance from the Walter A. Haas School of Business at University of California at Berkeley. End Quote

Samir Mathur has a successful background in the area of finance and technology and has held a number of leadership positions throughout his career!

(1888PressRelease) December 17, 2011 - Sources say Samir Mathur, a longtime leader in the finance industry is looking at the feasibility of setting up a new hedge fund or an asset management company for quantitative investment strategies.

Recently, there has been a substantial increase in interest to offer quantitative based investment ideas. The investment process in such strategies is to follow pre-defined investment rules rather than making discretionary decisions. A survey of the literature in this area suggests that some of these strategies include: rules-based asset allocation across different types of assets, creating efficient portfolios which act as better benchmarks than the existing indices such as S&P500, tail-risk hedging, and a number of carry-based strategies as well as a variety of arbitrage strategies. Groups, such as the one led by Samir Mathur, may have been involved in many of these areas.

Many banks are offering what they call Alternative-beta strategies, a subgroup of quantitative investment strategies, which provide investment themes generally offered by hedge-funds. These types of investments are often offered in a liquid and transparent fashion and the fees charged are much less than the typical fees charged by the hedge-funds. Beta, in literature, implies replicating a well known market index such as S&P500 by systematically buying the underlying stocks in the same weight as the index. As this strategy can be easily created by the large asset managers, the fee charged to offer such indices are typically much lower than the fees charged by the active managers.

Similarly, the Alternative-beta strategies create an investment theme by following systematic rules and can provide performance characteristics desired by investors who typically invest in hedge-funds. Many financial institutions such as the one where Samir Mathur worked may be offering many such ideas.

In theory, the typical hedge-funds offer returns which have two components - an Alternative beta, which can be replicated by following systematic rules-based strategies, and the Alpha, which is the further value added or subtracted by the hedge-fund manager on top of the Alternative-beta returns. Many industry experts suggest that the hedge funds should only be charging their high fees for the Alpha they provide and not the Alternative-beta part which can be easily replicated.

Much of this work can also be applied to asset-liability management; according to online sources, Samir Mathur has extensive experience in this area. Clearly, much of the investments by pension funds, insurance, endowments etc., have not worked out as well as the plan sponsors hoped for as often the liabilities of such plans have gone through the roof while the assets have been marked down. While most institutions chase Alpha, which typically have marginal impact on the return over a period of time, their un-hedged liabilities have gone through the roof, making it very hard for many of the institutions to meet their longer-term goals.

A number of banks and asset managers are looking to enter this space and offer ideas which address these issues. Industry sources say that there is room for new entrants in this space who can use the modern portfolio theory to much better address the broader investment needs. These new ideas require a marriage of finance with systems and quantitative background. Senior bankers like Samir Mathur with such a background could be looking to enter into this space with new asset management ideas.

About Samir Mathur

According to on-line public profiles, Samir Mathur has a successful background in the area of finance and technology and has held a number of leadership positions throughout his extensive career.

Samir Mathur also holds a MS in Computers and Information Systems from the University of Southern California, Los Angeles as well as a BS in Computer Science from the Indian Institute of Technology, India.

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