New Dubai Fund Recently Opened to Outside Capital Shares Strategy: Interview with Magellan’s Ahmed Omar

Magellan Capital recently launched its flagship hedge fund, Magellan Absolute Return SPC, with $975 million of public markets assets in AUM. That marks one of the biggest homegrown hedge fund launches in Dubai’s history.

The fund has also opened to third-party capital for the first time following its soft launch of a $700 million multi-strategy hedge fund in August 2024. Bloomberg reported that Magellan’s multi-strategy fund was one of the United Arab Emirates’ largest debuts ever.

In an interview with Hedge Fund Alpha, Ahmed Omar, chief executive and chief investment officer of Magellan Capital, shared details on the fund’s strategy, research process, reasons to sell and more.

Background on Ahmed Omar

Three years ago, Omar was Chief Investment Officer at a family office in the Middle East. The family office had been created from the public sale of his boss’s shipping business to Abu Dhabi National Oil Company (ADNOC) in 2022. He now leads Magellan Capital, which was created as a spinout of the family office.

“The business unit inside ADNOC that bought that business ended up IPOing in April or May 2023,” Omar said. “So it was a very public trade. Everyone knew about it.”

A well-covered family office

As a family office recently launched, he said they were well covered, meaning all the banks, hedge funds, private credit funds, private equity funds and secondaries knew them and reached out to them.

“So from that point of view, from that vantage point, I was in that driving seat looking at all the things that were being shown,” Omar added. “And a lot of them felt that they were, how can I put it? Second tier. Like when you look at the hedge fund space, it’s a very interesting industry because it’s been driven by very outsized returns by the top 10 percentile. And very average returns by the bottom 80 percentile, let’s say. And it’s also been driven by a very strong growth in U.S. public markets or the public markets in general.”

Drawn to the hedge fund industry

Of course, the U.S. has outperformed, and Europe has beaten Asia almost every year in the last decade, except for the last 18 months. Omar looked at that setup over the last five years and noted the U.S. stock market has delivered returns in the high teens on average each year. And that’s liquid, unlike private equity, which has a 10-year lock-up with potentially another two-year extension and other possible issues.