New Hedge Fund From Ex-Viking Co-CIO Seeks to Gain From Sell-Off

(Bloomberg) -- Ben Jacobs, the former co-chief investment officer of Viking Global Investors, is planning to launch his hedge fund, Anomaly Capital Management, in the fourth quarter with hopes of capitalizing on the stock market’s recent upheaval.

Jacobs expects to be one of the largest investors in Anomaly, which will focus on sectors including cyclicals, health care and consumer, according to a letter to prospective investors.

The market chaos caused by the pandemic pushed stock benchmarks to multiyear lows in March, shaking up industries and creating opportunities to bet on and against stocks. Jacobs, 39, is starting his own shop after leaving Andreas Halvorsen’s hedge fund last June when Ning Jin, with whom he shared the co-CIO role, was promoted to sole CIO.

“The market is presenting fundamental long-short equity managers with a once in a lifetime opportunity, and Anomaly is in a perfect position to capitalize,” Jacobs wrote. “We are grateful to have entered the market downturn in a position of strength -- having fresh capital, ready to deploy.”

While hedge funds have broadly outperformed the S&P 500 Index in the first three months of this year, the unexpected volatility and the severity of the rout in markets have challenged even the most seasoned managers. Ray Dalio’s flagship at Bridgewater Associates fell 16% last month and David Einhorn’s Greenlight Capital dropped 12%. What’s more, the market’s dramatic swings could create a vastly different investment climate six months from now.

Jacobs had spent a decade at Viking, rising from analyst to portfolio manager before he and Jin landed the top role in 2017, replacing Dan Sundheim, who departed and started D1 Capital.

Most of Anomaly’s infrastructure was in place before the coronavirus ran rampant. Following social distancing guidelines, the staff is working from home to guard against the virus spread.

Read more about Jacobs’s departure from Viking Global Investors

Jacobs has committed the majority of his net worth to setting up Anomaly’s business, team and infrastructure, the letter said. The New York-based firm’s 10-person team, split evenly between investing and operations staff, is expected to grow and will be “substantially in place” by the end of the second quarter.

Former PointState Capital portfolio manager Greg Ley joined as sector head of the cyclicals team. As analysts, Jacobs hired Isaac Freedman, who focused on technology and business services stocks at Glenview Capital Management; Joshua Greenberg, who was responsible for industrial and energy stocks at Viking Global Investors; and Greg Hart, who specialized in technology, media and telecom at Third Point. Chief Operating Officer Caroline O’Mahony was previously an executive at wealth management platform Addepar.

Anomaly will focus on global developed markets and is likely to hold 60 to 85 stocks, according to the letter. As CIO, Jacobs will manage positions and their sizing as well as gross and net exposures.

“Anomaly can deliver something different,” he wrote in the letter. “What we are building will be equipped to break down any barriers in the way of our goal: to generate superior returns and maintain the utmost confidence of our capital partners.”

A spokesman for the firm declined to comment.

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