Smaller than Average Fund Reaping Better Than Average Returns

May 14, 2019 James Heinsman Company Spotlight

Launched in 2015, Monica Hsiao’s Triada Capital Ltd is the little fund that could. Hsiao, who is a native of Guam, started her fund with a mere $7 million, some of it from her parents’ savings. That number is only about one-third of what an average Asia-focused hedge fund company begins with, at least recently. And compared with credit funds, $7 million is a drop in the bucket.

But the small size of the fund did not stop Hsiao from earning 10% after fees in only the first quarter.

Triada can thank Hsiao’s unrelenting dedication to research on companies for its great performance. Yes, the fund does make value investments and can profit from the changing spreads between securities, the majority of Triada’s gains come from Hsiao taking a view on credit events like mergers, refinancing, reorganizations, rating changes or sales of assets.

Hsiao is unusual in other ways as well. At 49, this is Hsiao’s second career. Previously she worked as an M&A and private equity lawyer in New York City.

“I really wanted to demonstrate that we could have a successful stand-alone business premised on long-short credit strategies, because I kept hearing this wasn’t viable,” Hsiao said from Hong Kong. “Part of me probably does also want to wave a flag for all the female portfolio managers who are minorities in the hedge fund world as well.”

Monica Hsiao, Triada Capital Ltd.,

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