Albert Ee, a former managing director of Millennium Management LLC’s Asian business, said he plans to set up a hedge fund in Singapore that will seek to profit from bets on broad economic trends.

 

AE Capital Management plans to start the macro hedge fund with between US$10 million and US$20 million as early as February, Ee said in an interview yesterday. The company aims to grow the fund to US$300 million ($372 million) in three years as it plans to expand the team to six people, including two portfolio managers, he said.

 

“I’m going to spend my time creating a track record first,” said Ee, who has about 22 years of trading and portfolio management experience. “I believe that if it’s successful, the money will flow in by itself.”

 

Ee, who said he “parted amicably” with Israel Englander’s Millennium in November, is planning the hedge fund as the Monetary Authority of Singapore seeks to tighten regulation of the hedge-fund industry. Ee said he has lodged an application with the MAS to be an exempt fund manager.

 

While the “ship is heading” in the direction of starting a hedge fund, Ee said he has also been in talks about joining other hedge-fund managers and bank proprietary businesses.

 

“It’s basically choosing the best option,” Ee said. “Either I manage a large sum of money for an institution, with the liberty and freedom to do what I want within risk limits, or I start my own operation.”

 

The MAS will start a public consultation exercise about tightening regulations after consulting the industry for some time, Michael Coleman, chairman of the Singapore chapter of the Alternative Investment Management Association said in October.

 

Licensing requirements may add to costs for Singapore’s hedge-fund industry, which the local chapter of AIMA estimates oversees at least US$34.9 billion, excluding assets managed by several of the large global firms.

 

Hedge-fund managers in Singapore are currently exempt from holding a capital-markets services license, provided they manage funds on behalf of 30 or less of what the MAS describes as “qualified” investors.

Ee’s fund will target returns of 15% to 20% after fees, Ee said. It will initially charge fees equal to 1.5% of client assets and 20% of investment profits.

 

Ee joined New York-based Millennium, which oversees US$7.5 billion in assets, in January 2008, expanding its team in Asia including hiring managers from Citadel Investment Group LLC and Galleon Group. From March 2005 to October 2007 he was president of the Asian operations of Tribeca Global Management, Citigroup Inc.’s hedge-fund unit that was wound down in 2008.

 

He was previously the deputy director of the foreign- exchange department of Government of Singapore Investment Corp., manager of more than US$100 billion of the city-state’s foreign reserves.

 

“The nature of my strategy is pretty liquid and scaleable and I used to handle much bigger than that when I was at GIC,” Ee said.