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Tyndaris nears launch of convertible bond fund - source

By Simon Jessop

LONDON (Reuters) - Alternative investment advisory firm Tyndaris plans to launch a global convertible bond fund led by managers Damien Regnier and Eric Daniel, a source with knowledge of the matter said on Wednesday.

The Tyndaris Global Convertible Fund has begun marketing to investors and should start trading in a couple of months, the source said, but it was not yet clear how much money it would launch with.

Convertible bonds, fixed income assets that can be converted into the equity of a specific company, form just a slice of the multi-trillion-dollar global bond market, although several large issues have come to market so far this year including one of $500 million from French luxury products firm LVMH .

Traditionally, the bonds have been bought and sold by so-called 'long-only' mutual funds or by alternative funds such as convertible-arbitrage hedge funds, which look to trade price anomalies between the issuer's stock and debt.

Unlike most alternative convertible bond funds, the Tyndaris fund would not use derivatives or trade in the stock of the issuer, and would provide investors the chance to get their money back on a daily basis, as opposed to monthly or quarterly, the source said, allowing it to be marketed to retail investors.

Convertible-arbitrage funds lagged other strategies in January, down 2.73 percent against a fall of 1.72 percent for the main fund-weighted composite index, data from industry tracker Hedge Fund Research showed.

Investing in mainly investment grade convertible bonds from across the globe, it would also not track the performance of a benchmark index like most buy-and-hold convertible funds, the source said.

Regnier is best known for running one of the world's biggest convertible bond funds for Deutsche Bank, the 3.5 billion euros ($3.94 billion) DWS Invest Convertibles fund.

Before that, he was a member of JPMorgan's convertible-arbitrage team, trading one of the largest proprietary books in London. Daniel, meanwhile, was previously head of equity derivatives and convertible bond sales at Citigroup in Paris.

The pair joined Tyndaris as partners in May 2015 from Castle Harbour Securities after plans to distribute a fund there failed to get off the ground.

Tyndaris, set up in 2012 by Raffaele Costa, one of the co-founders of Man Group unit GLG Partners, also runs a real estate fund.

(Editing by Keith Weir and Alexander Smith)