Gemmstock, the hedge fund set up by former Russia strategist Al Breach, almost quadrupled profits last year, bne IntelliNews can reveal.

Gemsstock, one of the few investment start-ups within emerging markets in recent years, posted a profit of £1.378mn ($1.75mn) last year compared with £361,171 in 2015. according to filings obtained by bne IntelliNews from UK Companies House. Dividends worth £801,462 were paid out during the year, the filings show.

Now that the hedge fund has strong three-year returns – a minimum benchmark required for most institutions to invest – it is expected to expand its investor base. The firm raised $800mn from external investors last year, while market sources told bne IntelliNews the firm has doubled its assets under management this year to more than $1.5bn.

Gemsstock is now rated as one of the biggest macro hedge funds in Europe by assets. Macro funds bets on macroeconomic trends using bonds, currencies, rates and stock futures.

“That’s a remarkable feat for a hedgie that’s only being going for three years,” a London fixed income portfolio manager told bne IntelliNews.

Gemsstock posted a gain of 20% percent in 2016, which far outstripped the 1% return of the average macro fund. Returns this year are believed to be more modest but are still well ahead of the pack.

In the filings, Director Darren Read said the principal activity of the firm is to manage the Gemsstock Master Fund and the associated managed accounts.

Breach, a reputed former Russia strategist at UBS, set up the hedge-fund firm with former UBS Moscow colleagues Read, Charles Hill,  and Vladimir Postolovsky, as well as UFG Asset Management's Florian Fenner.

UK regulatory filings show that Fenner, who remains a senior executive at UFG in Moscow, left Gemsstock in May.

Breach departed from Russia after quitting in 2007 as head of research at UBS, where he was also a strategist and economist. He joined what was then the UBS Brunswick joint venture in 2003 after four years as Russia economist at Goldman Sachs Group. He has since set up an internet venture, The Browser, and Furka Holding, a fund for family and friends from his base in Switzerland.

The fund, which is run by Breach and Read, who was a protege of Moore Capital’s superstar manager Greg Coffey. Named after the fabled Gemsstock Swiss Alpine mountain Breach can see from his nearby residence, it runs a multi-asset absolute return strategy investing into global emerging markets.

Edinburgh University mathematics graduate Breach has served on the board of Bank of Georgia as well as the investment firms East Capital and Vostok Nafta. But despite the experience of most of the founders of working in Moscow, it is understood that Gemsstock avoided investing in Russian securities in at least its initial year of operation.

Investment managers active in Russia and global emerging markets have been decimated over the past five years due to the collapse in commodity prices, the slowdown in China’s economy and relative outperformance of developed markets like the US.