Iftikhar Ali, a veteran credit trader, launched his own hedge fund company. This was according to sources who told Reuters about the fund's establishment. The hedge fund was established as traders look to cash in on turbulent market bonds.

Ali was the former head of the international propriety credit trading division of Bank of America. Recently, he held office as a hedge fund manager at Observatory Capital. The same source said the he planned to launch his new hedge fund firm, Rhodium Capital by fourth quarter of this year.

Ali did not give any statements regarding the report. Rhodium declined to comment.

The source added that it will take a "long-short" approach on Rhodium's end to trading investment grade and high yield credit in Europe, Middle East and Africa. The launching of the new hedge fund company came at a tough time for funds to start up. Many of these funds find it hard to draw investors that now account for the majority of new cash coming into the US$2.4 trillion hedge fund industry.