Saba Capital Management

Saba Capital Management
Private
Industry Investment management
Founded 2009 (2009)
Founder Boaz Weinstein
Headquarters New York City, United States
Products Hedge funds
Website www.sabacapital.com

Saba Capital Management is a credit relative value focused hedge fund, established in 2009. The New York City based company is a spin-out of a Deutsche Bank proprietary trading group founded by Boaz Weinstein in 1998.

History

The firm launched in August 2009 with $140 million and 15 members from Deutsche Bank.[1] In March 2011, Saba was listed as the fastest growing hedge fund manager in 2010 by Absolute Return + Alpha Magazine.[2] As of January 2011, Saba managed $2 billion in assets.[3]

Strategies

Saba manages investments centered on three strategies:

Credit Relative Value

The relative value strategy focuses on identifying dislocations across the capital structure. It utilizes a long / short, market neutral approach in credit and equity markets.[4]

Tail Hedge

The tail hedge strategy seeks to provide a cost effective portfolio hedge during periods of market stress and dislocation. This is implemented by investing primarily in credit default swaps (“CDS”) on a portfolio of low spread investment grade companies. In addition, Saba opportunistically buys CDS on indices and high yield companies, as well as equity puts and related instruments.[5]

Closed-End Funds

The closed-end fund strategy focuses on securities that are trading at significant discounts to NAV, thereby offering more yield than their underlying fixed income instruments – predominately high yield bonds and loans.[6]

Litigation

In March 2015, the Public Sector Pension Investment Board (known as PSP), a pension fund for the Royal Canadian Mounted Police and the Canadian Forces redeemed a $500 million investment it had made in Saba's flagship strategy in early 2012.[7] In September 2015, PSP filed a lawsuit against Saba, claiming that Saba had mispriced a portion of the fund’s assets after the retirement plan asked that all its money be returned at the end of the first quarter.[7]

As of May 2016, three of the four claims filed against Saba and Boaz Weinstein were dismissed. A breach of contract claim remains outstanding.[6]

References

  1. ↑ Kishan, Saijel; Simmons, Jacqueline (June 1, 2009). "Boaz Weinstein Said to Raise $160 Million for Saba Hedge Fund". Bloomberg.
  2. ↑ Ahuja, Maneet (2012). The Alpha Masters: Unlocking the Genius of the World's Top Hedge Funds. John Wiley & Sons, Inc.
  3. ↑ Childs, Mary; Harrington, Shannon (January 26, 2011). "Saba Betting on Greek Rebound Buying 'Deeply Discounted' Bonds". Bloomberg.
  4. ↑ Abramowicz, Lisa (February 27, 2014). "Saba Lured by Biggest Fund Discounts Since '09: Credit Markets". Bloomberg.
  5. ↑ Benner, Katie (September 9, 2011). "Saba Capital: A hedge fund bright spot". Fortune.
  6. 1 2 Dolmetsch, Chris (May 18, 2016). "Boaz Weinstein Wins Another Round With Canadian Pension Fund". Bloomberg.
  7. 1 2 Gara, Antoine (September 25, 2015). "Canadian Pension Fund Says It Was Cheated By Boaz Weinstein's Saba Capital". Forbes.
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