The company is following in the footsteps of a number of private equity companies moving into the hedge fund sector in a bid to boost returns.
Quadrangle is establishing a hedge fund following its recent merger with New York fund Harpoon Equity Management, which will become Quadrangle Equity Investors and will be managed by Harpoon founder Robert Donahue, according to Reuters.
The New York-based alternative investment firm currently has more than $4 billion in assets under management and invests in media and communications companies through its Quadrangle Capital Partners private equity business.
Hedge funds are private investment funds that use hedging techniques to limit risks and trade and invest in a range of assets such as securities, commodities, currency, and derivatives. Private equity funds tend to take a longer-term stake in a business and investments can last up to five years.
There are now thousands of hedge funds in existence and they are becoming increasingly popular with wealthy private investors and companies due to strong investment performance in recent years.