Credit Suisse Commodities Traders to Start Hedge Fund

An eight-person commodities trading team is reported to be leaving Credit Suisse Group AG to start a hedge fund backed by the Blackstone Group.

The Wall Street Journal, citing unnamed sources, is reporting that the latest spinout group is led by George “Beau” Taylor, currently Credit Suisse’s global head of commodities-arbitrage trading, and Trevor Woods, head of energy-arbitrage trading.  Taylor and Woods will be chief investment officer and chief executive officer, respectively, of the new hedge-fund firm, which isn’t named yet, according to the Journal’s sources.

The Credit Suisse team will trade in commodities and energy markets and make macroeconomic bets in areas such as currencies, the Journal reported. A launch is planned for early 2011, with $150 million from Blackstone at the start.

The team is one of the first Blackstone has selected for startup funding since U.S. lawmakers in July passed sweeping legislation to curb proprietary trading, or trading using banks’ capital rather than clients’ funds, the newspaper said. The planned spinout involves one of the biggest trading groups to leave Wall Street.

At Credit Suisse, the proprietary-trader population has been whittled from about 250 at its peak to 100, according to the news report.