Winton Capital Management, the $8 billion (£4 billion) hedge fund manager, is mulling the initial public offering of one of its funds on the London Stock Exchange. It is expected to make a decision on whether to favour the capital over Euronext within a month.

Although a number of hedge fund managers have listed in the past year, no single-manager, single-strategy fund has yet joined the LSE. MW TOPS, the largest of the single-manager, single-strategy funds to list, raised €1.5 billion (£980 million) last month on Euronext in Amsterdam.

That Winton is considering a London listing reflects a rethink last month by the Financial Services Authority on proposed strict new rules for investment companies listing in the UK. The City watchdog backtracked on its own rules after losing a series of high- profile floats to Amsterdam.

Winton plans to raise at least $200 million with the flotation. The funds will be used as permanent capital, meaning that the fund can invest in more complex, longer-term strategies. The float is being marketed by Dexion Capital, the consultancy thought by many to have pioneered the listing of funds of hedge funds in Britain. Winton was founded ten years ago by David Harding, one of the creators of the well-known AHL trading system used by Man Group, the world’s largest listed hedge fund manager.

Using a system similar to AHL, a Guernsey-based company will be created and listed. The company, to be managed by Dexion, will replicate transactions made by the $3 billion Winton Futures Fund, a hedge fund that specialises in global financial futures.

The fund uses computer-generated trading strategies to build a portfolio of futures across different financial markets.

By listing a company rather than the fund itself, Winton can guarantee daily pricing of shares and greater liquidity. For British investors it also means that the investments will be subject to capital gains tax rather than income tax.

The Winton Futures Fund returned 17.5 per cent after fees last year.

Robin Bowie, the chairman of Dexion, said yesterday that the decision on listing in London or on Euronext would be made in the next month. The float itself will take place in late April or early May. Both institutional investors and wealthy individuals will be targeted in a roadshow. At present Winton has relatively few UK investors.

The decision to back a single-manager, single-strategy fund is a departure for Dexion. The consultancy, which has listed four funds of hedge funds in London, has concentrated on multimanager, multistrategy funds.