The insider trading trial involving Segantii Capital Management founder Simon Sadler is approaching its conclusion in Hong Kong, with prosecutors delivering their closing arguments in the high profile case, according to a report by Bloomberg.

The charges case centres on trades in Hong Kong-listed fashion retailer Esprit Holdings in June 2017. Sadler, former Segantii trader Daniel La Rocca, and the hedge fund itself are on trial over allegations that they traded on confidential information ahead of a large share sale by Lone Pine Capital.

Prosecutor Sarah Clarke told the court that the defence case was undermined by the evidence presented during more than a month of proceedings. The trial has featured emails, recorded telephone conversations and testimony from several witnesses, including Tony Psarianos, a former Bank of America trader, and another former bank employee, Anshul Trivedi.

At the heart of the prosecution's case is a conversation between Psarianos and La Rocca shortly before Lone Pine sold its remaining Esprit stake. Psarianos allegedly told La Rocca that an unnamed shareholder was considering selling at least 190 million shares. La Rocca subsequently identified Lone Pine as the potential seller and informed Sadler and other Segantii employees.

Prosecutors allege that Sadler and La Rocca then began selling Esprit shares held by Segantii and established a short position within hours of receiving the information. The trades were worth slightly more than $1m, a relatively small position for a hedge fund that at the time managed billions of dollars.

The prosecution's central argument is that there was no credible reason for the trades other than the traders having access to price-sensitive information about the impending block sale.

Sadler has previously disputed that interpretation. During his testimony, he said he had reviewed research on Esprit prepared by former Segantii analyst Vikki Huang and concluded that the firm's position had become “lazy, stale”. He also described the short position as part of routine inventory management within the firm's multi-strategy trading operation.

The case centres on Lone Pine's disposal of its entire remaining 10% holding in Esprit. The transaction represented more than 60 times the stock's average daily trading volume at the time, making the planned sale potentially significant for the share price.

Defence lawyers are due to make their closing arguments in the coming days. The trial is expected to conclude this week, although a verdict will follow at a later date, with separate legal teams representing Sadler, La Rocca and Segantii.

Sadler established Segantii in 2007 with $26 million and built it into one of Asia's prominent multi-strategy hedge funds, with assets eventually exceeding $6 billion. The firm became a major participant in regional equity block trades, competing with much larger firms including Marshall Wace and Jane Street.