Oct. 3 (Bloomberg) -- Alexander Kinmont, the equity strategist who wrote “The Irrelevance of Japan” report in 2002, is planning to start a hedge fund focused on the country after leaving Morgan Stanley MUFG Securities Co. in July.
Kinmont, formerly a managing director of Japan equity strategy at Morgan Stanley MUFG in Tokyo, is heading Tokyo-based Milestone Asset Management Co., he said. The company currently offers a long-only fund and is planning to start a long-short hedge fund later this month to profit from rising and falling stock prices, he said, declining to elaborate further because it is still being planned.
“We’re starting the fund now because Japan is cheap for the first time in a generation,” Kinmont, 47, said in a telephone interview today. “The fund-raising environment is extremely difficult, but experience shows when it’s difficult to raise money, it’s usually the case that capital can be invested at attractive returns.”
Kinmont characterized Japan as unimportant for investors “except as a laboratory experiment concerning deflation” in the December 2002 report he wrote while employed by Nikko Citigroup Ltd. He reversed that view in April 2009 with a report for Morgan Stanley entitled “The Relevance of Japan,” saying the easing of fiscal and monetary policy might boost earnings by ending deflation.
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