Building on a multi-decade track record, Australian-headquartered Farrer Capital will provide global agricultural commodity exposure to deliver investors truly uncorrelated returns
The former Head of Commodities Trading at Merricks Capital is, today, launching a global agricultural hedge fund, targeting an initial raise of USD $500 million. Australian-headquartered Farrer Capital is being launched ahead of iConnections Global Alts Conference in Miami next week, and is headed up by Merricks’ former Head of Commodities Trading and Finance, Adam Davis (CIO). Davis has more than 20 years’ experience in global commodity investment, and a proven track record in building and executing profitable trading strategies. He led Merricks’ Soft Commodity Fund from its 2008 inception to over $600m AuM.
Q4 2023 hedge fund letters, conferences and more
Farrer Capital’s hedge fund will specialize in the trading of global agricultural commodity markets, using a fundamental, relative value approach, enhanced by a proprietary quantitative investment process. Geopolitical tensions, rerouting of trade flows, structural shifts in renewable energy demand, and the increasing frequency and severity of supply side shocks due to climate change, will increasingly offer attractive risk-adjusted trading opportunities.
The founders – Adam Davis, Alistair Fullerton (COO) and Les Finemore (Portfolio Manager) – are currently in advanced discussions with a number of cornerstone institutional investors. The firm is targeting a 15+ percent return on investment with a Sharpe >1.4. Running parallel to the hedge fund, a number of high conviction special opportunities will be available, targeting 20-25+ percent returns.
The high-performance investment firm was established in Q4 2023 and backed by several prominent Australian investors. Farrer Capital’s founders have consistently delivered for the world’s premier asset allocators, and combine unrivaled agricultural sector expertise with a multi-decade track record in alpha generation and risk mitigation across both the derivative and physical commodity markets. Alongside their domain expertise in global agriculture, they will harness proprietary technology to deliver a highly sophisticated quantitative edge to their strategies.
In addition to Davis’ background, Alistair Fullerton has more than 20 years’ experience in global financial and commodity markets with a decade on the sell-side, before founding a commodity trading and arbitrage business in Hong Kong across biofuels, agricultural commodities and clean energy. Since returning from Asia, he co-founded one of Australia’s most prominent agricultural VC firms and is an advisor to several Australian Government agricultural departments. Les Finemore, meanwhile, is the former CIO of commodity hedge fund Imbue Capital and ex-Merricks alumni, working alongside Davis. He boasts a rare skill set combination, fusing a powerful understanding of global financial markets and an extensive agronomic knowledge, with machine learning and big data.
Speaking about the launch of Farrer Capital, Chief Investment Officer, Adam Davis, said:
“We are thrilled to be launching Farrer Capital ahead of the iConnections Global Alts Conference next week. Investors are increasingly demanding fundamental sector experts that can navigate the complexity of the world’s food supply chain. We continue to see outstanding trading opportunities arising from volatile weather patterns, rising geopolitical risks and the re-routing of global trade flows. Utilizing our deep domain expertise and fundamental approach, enhanced by our quantitative investment process, provides us with the capability to continue delivering consistent uncorrelated returns for our investors.”
About Farrer Capital
Farrer Capital is an Australian headquartered hedge fund, specializing in the trading of global agricultural commodity markets, using a fundamental, relative value approach, enhanced by a proprietary quantitative investment process.
