Legendary market strategist Morgan Stanley buys into its former guru Barton Biggs - Crain's New York Business

by Andrew Milkowski

Bank's famed market strategist, who now runs his own hedge funds, gets $150 million from old employer to launch three new investment vehicles

By Hilary Potkewitz
Legendarymarket strategist Barton Bigs forecasts another 15% bounce for thestock market by the end of the year. (previously he called thetechnology bubble and recession that followed a full year before itburst. (International Herald ...Tribune, 10/3.../1998) Recently, Bigs The just received $150 million from his former employer as seed money to launch three new hedge funds.Barton M. Biggs former Morgan Stanley chief global strategist now runs Traxis

Partners, a multi-billion dollar hedge fund based in New York City.

Legendary market strategist Barton Biggs still has the touch to attract tens of millions of investment dollars: The former Morgan Stanley chief global strategist just received $150 million from his former employer as seed money to launch three new hedge funds.

At Mr. Biggs' hedge fund firm, Traxis Partners, the flagship Traxis Fund lost about 30% in 2008, while the average multi-strategy fund lost 24%, according to the Credit Suisse/Tremont Hedge Index. So far this year, Traxis is outperforming the average; the fund is up about 35% for the nine months through September, while the sector average is hovering at 21%.

The new funds, which launched over the past several weeks, are thinking and acting globally. Traxis Global Credit Opportunity Fund reportedly was seeded with $50 million that's now under the guidance of Amer Bisat, a Morgan Stanley alum and emerging markets debt specialist who is also a former manager at U.K. hedge fund Rubicon Partners. Traxis Multi-Asset Macro Fund is run by founding partner Cyril Moulle-Berteaux, yet another former Morgan Stanley player at the firm, while Mr. Biggs is managing the new Traxis Global Equity Macro Fund.

As with most hedge funds, Traxis uses the two-over-twenty rule for fees, meaning it charges a 2% management fee and takes a standard 20% performance fee on gains. To attract larger investors, Traxis is offering a 1.5% management fee for accounts over $5 million.

Mr. Biggs is relentlessly bullish on the market these days, forecasting as recently as mid-October another 15% bounce for the stock market by the end of the year. But he probably became most famous in investment circles for his timely bearishness, anticipating the bursting of the tech bubble and the ensuing recession—about a year before it all popped.

Calls to Traxis were not immediately returned. Morgan Stanley declined to comment.