Segantii to refund investor money after Hong Kong insider trading charges

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May 23 (Reuters) – Hong-Kong-based Segantii Capital Management has told its investors it will return their money, weeks after authorities charged the hedge fund and its founder, Simon Sadler, for insider trading, a spokesperson for the firm said on Thursday.

The move marks a turning point for Sadler, dubbed Asia’s “block trade king” and his fund.

Returning external money means the Asian fund giant is likely to only manage its own capital going forward.

“We have always believed at Segantii that it is a great responsibility and privilege to professionally manage money — and we have never taken that lightly,” the spokesperson told Reuters.

“We have decided, however, that at this time, it is in the best interests of our investors to return their capital in an orderly manner.”

The decision by the $4.8 billion hedge fund was first reported by the Financial Times.

Segantii didn’t reply to Reuters’ inquiry about whether the fund will be liquidated.

The Hong Kong Securities and Futures Commission (SFC) said this month it had started criminal proceedings against Segantii, Sadler and the firm’s ex-trader for insider dealing in the shares of a Hong Kong-listed company prior to a block trade in June 2017.

Market participants say it is rare for the city’s securities watchdog to treat insider trading as a criminal case.

“The proceedings might signal the dawn of heightened regulatory vigilance across Asia’s trading community,” said Kher Sheng Lee, co-head of the Asia Pacific Alternative Investment Management Association.

Sadler held senior equities trading roles at Deutsche Bank and HSBC Securities before establishing Segantii in 2007.

The British investor is also the owner of his hometown soccer club, Blackpool Football Club.

Segantii has grown to one of oldest and biggest hedge funds in Asia – with operations in London, New York and Dubai, according to its website.

Its flagship Asia-Pacific Equity Multi-Strategy Fund was up 2.8% in the first four months, after a 1.6% decline in 2023, according to a source who received data on the fund’s performance.

 

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Edmund Shing, PhD

Global Chief Investment Officer
BNP Paribas Wealth Management

Edmund has over 29 years of experience in financial markets in a wide variety of positions, ranging from proprietary trading to portfolio manager in a number of financial institutions in London and Paris.  He previously held the role of Global Head of Equity and Derivative Strategy at BNP Paribas in London from 2015 to 2020, and has been Chief Investment Officer at BNP Paribas Wealth Management since November 2020.

Edmund is responsible for piloting our investment strategy and will continues to rollout out recommendations and themes with actionable advice that brings our expertise to our clients and support to our client-facing teams.  In this time of change, his expertise in following and anticipating markets is a true value added for both our customers and those at Wealth Management who serve them.

Edmund has a PhD in Cognitive and Computing Science from the University of Birmingham in the United Kingdom, and has done advanced studies in Knowledge-Based Systems and in Experimental Psychology.  He is an EFFAS-certified financial analyst. He has also authored the book “The Idle Investor” published by Harriman House in 2015, proposing 3 simple investment strategies that take only a few minutes to execute per month.

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