Goldman plans new hedge fund

Goldman Sachs Group Inc. is aiming to raise between $4 billion and $6 billion for a new hedge fund in an effort to patch up the tattered reputation of its hedge fund business, according to a report in The Financial Times, which cites potential investors. The new fund, which will be run by bank partners Raanan Agus, former head of the proprietary trading desk, and Kenneth Eberts, former head of the U.S. proprietary trading desk, will be the first from the bank to focus on hand-picking shares, rather than using computerized, or quantitative, approaches. If the new fund gets raises $6 billion, it will be one of the largest hedge fund launches ever, rivaling the $6 billion fund launched by Convexivity, which was created last year by Jack Meyer, former head of the Harvard University endowment. The New York-based investment bank's position in the hedge fund industry took a hit in August after its Global Alpha fund posted double-digit declines in 2006 and plunged more than 20% in that month (InvestmentNews, Sept. 13) .