Following Enron's well-publicized woes, many Texas-based energy groups have either slimmed down their trading operations or shed them entirely, spurring an exodus that has led to a number of new hedge fund start-ups by ex-prop desk traders. One such hedge fund start-up is Houston-based Computational Management, headed by Jay Epperson and Terry Lohrenz, former traders with Duke Energy.
Computational Management recently opened its new long/short equity fund to outside investors. The U.S. fund takes a market-neutral approach, trading statistical-arbitrage models. Although energy stocks are included in the mix, the strategy itself is not sector specific, according to Epperson.