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Hallgarten sets up new LatAm hedge fund Hallgarten is setting up a new LatAm dedicated hedge fund, the Pergamene Latin American Fund, which will be benchmarked against the S&P Latin 40 equity index. It should reach target size of $35m-$40m in 3-6 months, Christopher Ecclestone, a strategist at Hallgarten who will run the fund, tells LatinFinance. Pergamene, understood to be among the first pan-regional long-short hedge funds, will seek alpha through fundamental analysis largely with a GARP approach, as well as a macro overlay sensitive to political risk.

It plans to diversify away from the obvious large caps dominating the S&P Latin 40 like America Movil, CVRD and Petrobras and use the IShares ETF that tracks the index to go short. “The index strongly underweights Argentina and ignores Peru, Colombia and Venezuela, while leaving many sectors that power economic activity in the region, such as mining, agroindustry, retail and construction under-represented,” says the fund in its marketing. The portfolio will be long approximately 120% (20-35 positions) and short approximately 20% (5-8 positions). By being truly pan-LatAm, Pergamene aims to avoid country-specific political or economic crises. It will also try to ride out money tides hitting markets like Brazil and Mexico when non-dedicated investors make jerky movements in and out of the markets in those countries. The Fund intends to limit individual positions to 5% of the portfolio at cost and monitor posi......................

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