At which point twenty per cent of any winnings are theirs to keep. In a good year, and there’s been a couple of rubbish years to factor in since they set up in 2010 but mostly they’ve been healthy thanks to Max’s equity bias, fund performance has annualised at around five per cent. So that’s $7.5 million profit on a year’s investing, which makes $1.5 million for the firm. For many of the investors, their profit is tax efficient because although the investment manager is in London, the fund itself is domiciled in the Cayman Islands and they too are offshore ‘sophisticated’ investors. They’d taken a hit on Brexit – $12 million or so, but nothing that couldn’t be recouped quickly enough.
And it’s not like just going to the bookies and slapping a tenner on Lady Luck to win the two o’clock at Kempton Park, because they are constantly hedging their bets. “That’s why they’re called a hedge fund, dummy,” Harry had once overheard Max telling some stranger in Tramp on Jermyn Street. Mind you, if you make a loss, it has to be recouped before you can earn more performance fee, that’s why they call it the high water mark. But even if you don’t, it’s not like some goon in a cheap suit is going to come round and repossess your house. It’s all very civilized and investors can always cut their losses and redeem with a month’s notice. This they don’t teach you at school.
* * *
Harry wakes at six, ten minutes before the alarm of his iPhone with its increasingly annoying ululating New Age medley supposed, he assumes, to gently lead the unconscious mind into wakefulness, from whatever floaty spaced dreams you might be having.
Except that Harry has been having a sort of semi-nightmare – unsettling more than frightening – involving himself and Max and a frantic tube journey around London. Though this is nothing like the real London; it is a London that only exists in Harry’s dreams, where the topography is all askew. Most of North London is countryside, for example. And the bit he always remembers – because this is a dream he has often – is that he finds himself on the wrong Circle Line train and missing the connection that will take him back. Except it’s not the Circle Line. It’s not even London, except it is and it isn’t.
What fucking genius directs these crazy films we call dreams?
A slash of light above the curtains tells him it’s a bright day outside, and for the next twenty minutes he runs on automatic. He showers, washing his hair with his prescription anti-dandruff shampoo before lathering in an expensive conditioner that claims to add thickness, and scrubs his body with the contents one of one of those small bottles he habitually picks up from hotels. Harry turns off the shower and, as is his ritual – a moment of pure being on a workday morning – he allows the water to fall from his body, feeling it ripple down his torso and legs, before stepping out of the cubicle and into his towelling dressing gown.
From the fitted wardrobe: a thin blue-striped shirt and navy silk cufflinks from Hackett, navy blue boxer shorts from Marks & Spencer (a Christmas present from his mother, bless her), charcoal-coloured cashmere socks to match his birdseye charcoal-coloured suit; off the peg but well-fitted. No tie: open-collar as usual.
He puts the kettle on and notices, through the expensive bi-folding patio doors courtesy of a previous owner, that it appears to be snowing, which is odd because he can only see a clear blue sky. And then he realises it’s the blossom coming off the tree next door. Is it spring already?
A cup of peppermint tea, a brief scan of his unread e-mails, and he slips his wallet into his jacket pocket and is about to set the alarm when he catches sight of something out of the corner of his eye. He gives an involuntary cry, and steps back, the hairs rising on his scalp and the back of his neck. A mouse. At least he hopes it’s a mouse.
Fuck, he hates old houses. Why did he allow Max to talk him into this three-stroke-four bedroom late Victorian terrace house in a leafy part of Hammersmith that an enterprising estate agent had once rebranded Brackenbury Village? But it really is like a village, thinks Harry; more ‘villagey’ perhaps than most villages in the countryside, like the one where his mum lives, which is basically just a bunch of houses plonked down in the middle of some fields, with their one pub full of bores.
Anyway Max insisted he buy here back in 2007 when mortgages were cheap and plentiful, especially when arranged through a broker Max had recommended.
Still £800,000 for three slash four bedrooms – the fourth bedroom barely big enough to house the exercise-bike that he never uses – seemed a lot at the time, and Harry had argued that he didn’t need anything this big. But Max had gone on and on, like he was going to make something out of the deal. You’ve got to have a family home – that’s where the market is around here. How did he know? Why did he care? Max just sees the trade in everything. Not to have done it would somehow have injured his sense of right and wrong.
Soon after he bought the place there was the crash, Harry losing his job, with six month’s ‘voluntary redundancy’ pay-off to cushion the blow, and all sorts of dire prophecies about the property market. But interest rates were so low that no one needed to panic sell and anyway people were in a mood to sit tight. And then rich foreigners kept piling into London – a safe haven from the chaotic Eurozone, and for corrupt Russians and other criminals, and for newly enriched Asians with tax-free wealth to invest.
And on and on it went, and Harry’s pretty but otherwise unremarkable Victorian house is now apparently worth at least £1.4 million, even with London prime’s flattened, post-Brexit softness. But still, that’s half a million pure profit – the tiny fourth bedroom where Harry stored suitcases alone adding at least £75K in value. “And that’s a conservative estimate,” said the agent who had sent about twenty postcards begging for Harry to allow him to value his home and was now, in his excitement, almost bursting out of his cheap suit. “If it goes to sealed bids… well, let’s just say that we’ve been breaking records in this area every week.”
He looks at his watch. Six thirty. The house is reasonably close to three underground stations – Shepherd’s Bush on the Central Line, Hammersmith on the Piccadilly Line and Ravenscourt Park on the District Line. Harry prefers Ravenscourt Park – it’s a shorter walk, and all he needs to do when changing at Hammersmith is to step across the platform and on to the Piccadilly Line, which is never too busy at this time of the morning.
He always gets into the last carriage because it stops nearest to the exit at Green Park. And when he reaches the station, at least a dozen freshly showered and spruced-up men dressed just like Harry in expensive suits and shirts, open at the collar, step out alongside him. If any of them found it amusing they never showed it.
His routine is to buy a croissant and an Americano with hot milk from the Starbucks on Berkeley Street. They always ask him his name so that they can write it on the cup. Harry must have told them that it was Harry hundreds of times, but of course they don’t remember; that’s not part of the job. So recently he has taken to calling himself Max, safe in the knowledge that Max never steps inside Starbucks; Max’s morning routine is to drink a disgusting-looking smoothie containing beetroot, kale and whatever the latest ‘superfood’ happens to be, from the juice bar two doors along.
The office of Forward-Max Capital LLP is in an elegant redbrick town house on Farm Street. There is a small bank of buzzers in a tin box, each with anonymous, slightly tatty address cards – mostly for companies ending in the letters LLP. This is about as brazenly as hedge funds advertise themselves, although visible through the glass door, the marble staircase and oversized chandelier does all the promotion that is necessary.
Harry buzzes himself in, exchanges pleasantries with the porter, an old-style cockney – probably the last one left in Mayfair – and takes the lift up to the third floor. The building is leased by two other fund managers along with Harry’s – although the firm is really Max’s, the majority owner with a fifty-one per cent stake. Harry’s holding is ten per cent.
Not that Forward-Max Capital LLP actually owns much in the way of assets. There’s the fur
niture – glass and chrome inevitably – and the computers tirelessly parading banks of numbers and Bloomberg charts – six screens each for the portfolio managers, and three for Harry. But most of the tangible assets are hanging on the walls – quality artwork, not from some bespoke office-art website but all carefully sourced from local Cork Street galleries whose owners Max has schmoozed over the years. Modern stuff, semi-abstract landscapes mainly, and nothing too cutting edge.
“Leave that crap to Saatchi and the Russians,” as Max once said.
“Good morning… lovely morning… spring has sprung,” trills Fi, the latest receptionist-cum-office manager. She’s only recently graduated from Exeter University with a degree in French. She’s cheerful, presentably good-looking in a slightly bovine way and will no doubt be moving on soon enough, although, God knows, well-paid jobs like this for a twenty-three-year-old in London are hard enough to come by.
“What do we pay you, Fi?” asks Harry absently, almost surprising himself as much as Fi by saying this.
“Forty-five K base,” she says, followed by a wary “Why?”
“Oh, sorry… no reason. Just trying to remind myself,” he says briskly. “Keep up the good work.” He thinks he hears her laugh as he walks through into the open-plan office, where James, Max’s co-CIO, or chief investment officer, is already at his desk.
“Morning,” James says though a mouthful of pastry so it sounds more like, “Maw…maw.”
The other three desks, usually occupied by Max and the two research analysts – Tim, who is American, and Cyril, who is French and the butt of Max’s anti-French comments – are empty save for the banks of computer screens. On the wall, a huge TV screen hangs stuck on low volume and showing the Bloomberg news channel, a stock ticker along the bottom of the screen glowing red and green. James and the analysts continue their discussion and planning around Porsche and Volkswagen, two short positions Max had been looking to put on by borrowing the stock from their prime broker, who had a decent volume in their inventory. James had the authority to do the deals in Max’s absence and would be pulling the trigger that day.
Harry is Chief Operating Officer, a ‘glorified office manager’ as he once heard Max describe the position, and therefore in charge of hiring and firing the likes of Fi. Finance, compliance and operations are also in his remit, although Max, who thinks that only portfolio managers should be taken seriously, likes to say: “There’s not much to do once the trade has been made.” In reality, given all the regulatory intervention since 2008, Harry had the most liability of them all and would be the one most likely to end up in jail, if it turned out there was any market abuse or other wrongdoing by any of the team. Even portfolio managers were starting to hear that penny drop.
Max had suggested Harry for the role after he lost his back-office job at an investment bank during the crash. His new firm was looking for a COO and Harry was available, and he seemed to have the right credentials. Max always had more confidence in Harry’s worth than Harry ever had. More importantly, thinks Harry, he wanted a playmate. “I hate being on my own,” Max has said on countless occasions. And now they were doing their personal account trades – the diamonds, the property, paintings, the watches – Harry was also a partner in crime. Except they weren’t committing any crimes. More like a hobby really, or, as Max prefers to call it, the concierge game. Every business in Britain is in the same game, he likes to say: “We’re concierges to the world.”
CHAPTER FIVE
It’s eight thirty in Geneva and Max hasn’t slept a wink. It’s neither early nor late; he doesn’t feel refreshed or sleepy; he’s living in the past, present and the future all at once, and it’s making his head spin.
The plane landed just before three, local time, and then Simon had suggested they all go to a place he knew. It seemed ungrateful to refuse. The club contained an acquaintance, and after a brisk transaction, Simon and Genevieve took it in turns to visit the toilets, sniffing loudly on their return and looking very pleased with themselves. “No thanks,” Max had said, on the five or six times he was offered the little paper wrap.
They drank coffee together in an all-night café on the Plaine de Plainpalais before Max took his leave of his by-now gabbling and limb-entwined companions and hailed a cab to his leased apartment in the Paquis – a lively and relatively scruffy but inexpensive district that he preferred to the smart bourgeois parts of town. He has no need for appearances in Geneva.
The two-bedroom flat is on the fifth floor and painted a uniform calico colour, and has a view from the living room of the lake. As he unlocks the front door and steps into the hallway he is hit by the silence. And when he gets used to that, all that he can hear is a ringing in his ears. Ringing… why do they say ringing? It’s more like a high-pitched hum; white noise.
He goes over to the bedroom wardrobe, which contains an edited version of his wardrobe back in London: two suits, handmade by an independent tailor who used to visit him back in his investment banking days but which still fit beautifully even though Max has put on several pounds; several Ralph Lauren cashmere V-neck jumpers and a whole row of Turnbull & Asser shirts in varying single-colour shades, but the same monogrammed initials on the cuff: M-D.
There are also the casually expensive clothes, the smart/casual tapered trousers, designer jeans and Gucci loafers, the linen trousers for when it gets sticky in summer, and his running gear. This gives Max an idea and now he is pulling off his clothes as if in a race against time, and slipping into his shorts over black Nike dri-fit leggings and tying his trainer laces. He switches his watch for a complex digital GPS training device and walks briskly out of the apartment. It’s a ten-minute jog to the shoreline of Lake Geneva, and now he sets off at a good pace. The early morning is overcast and grey and cold, but slowly he starts to feel better.
After a mile or so, he stops at a bench looking out over the lake, catches his breath and whips his phone out of his tracksuit pocket. The music from his earphones fades politely as he dials Dieter the gemologist, but only gets his answer-phone. “Dieter… Hi, it’s Max… It’s Tuesday… I’m over from London looking for a good stone. I was wondering whether I could pop over today… maybe this afternoon. Give me a ring. Bye.” Then he adds as an afterthought. “Auf wiedersehen.” Clocks by Coldplay resumes position and volume, and he continues running.
* * *
It’s mid-morning in London, and most of the action on the European stock markets has already happened. There might be another burst of activity just before closing time, but for now a lull has descended and Harry finds himself at his desk and staring out of the elegant Georgian office window.
He’d already phoned the agent about the house on Charles Street and felt confident that the Arab’s offer would be accepted by the end of play. Twenty two million with London prime going into reverse was not to be sneezed at.
Houses, and the store people put by them. His mum had only ever rented, and when the big farming estate almost doubled the rate a few years back – “to reflect market conditions” – Harry had stepped in to help out.
He had only ever visited Max’s childhood home once, early on after they reconnected in their mid-twenties.
It had been a baking hot summer weekend and, feeling like a couple of swells, they had driven west out of London along the M3, roof down and music blaring, in a hired BMW convertible. “Never buy a car,” was one of Max’s aphorisms from that time. “One of the worst investments you can make.”
He had since heard Rachel, who didn’t get on with Max’s family and never visited unless she had to, mock the house as ‘suburban’, but it seemed pretty impressive to Harry as they swung into the gravel drive that searing July Saturday; a detached building clad in red tiles with a steep, almost fairytale roof, and surrounded by close-cropped lawn browning in patches from a prolonged heatwave. “Perfect,” said Harry, not for the first time that weekend, as Max cut the ignition.
Two dogs, English Setters Harry later learned, came lumbering
out of the house to greet them, tails wagging furiously and the sides of their mouths turned up so they almost appeared to be grinning. A short way behind them came Max’s mother, Sally, scrunching unsteadily on the gravel. Standing in the front doorway leaning up against one of the jams was a young woman – a female Max – honeyed skin, molten chocolate-brown eyes and a slightly sardonic smile on her lips.
Natasha was the sister’s name and she was the most immediately welcoming of the family. Sally, the mother, was clearly besotted with her son, and seemed to view Harry as unfortunately necessary baggage. Max’s father, Michael (or, as he insisted, Mike) was a semi-retired surveyor who had made his first fortune buying and then quickly reselling an office block on the Fulham waterfront back in the Eighties. They found him in the living room watching Test cricket on TV. He was wearing a sleeveless cricket jumper, Harry remembers, dirty old tennis shoes on feet that were up on a coffee table on which sat an open bottle of vintage white Burgundy. He didn’t offer them a glass.
“How we doing?” asked Max.
“What do you think? Another sodding England batting collapse in the offing,” said his father, before reaching up and giving Harry a perfunctory handshake. “Follow the cricket, Harry?”
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