Stanley Shopkorn Resigns Post At Moore-Run Hedge Funds
By RANDALL SMITH and GREGORY ZUCKERMAN
Staff Reporters of THE WALL STREET JOURNAL
May 18, 2000
NEW YORK -- One of Wall Street's best-known stock traders is hitting the sidelines amid continued volatility in the markets.
Stanley Shopkorn resigned as head of equities at hedge funds run by Moore Capital Management Inc., led by trader Louis Bacon. Moore is one of the largest hedge-fund groups remaining on the scene, with roughly $10 billion under management, in the wake of pullbacks in the past few months by two other high-profile hedge-fund managers, Julian Robertson and George Soros.
The Moore-run funds are down roughly 5% this year, according to one person at the company, after gains of more than 25% in 1999 after fees. By comparison, comparable "macro" hedge funds, which make broad market bets, were down 3.57% after fees through April of this year, according to the Hennessee Group, which monitors hedge funds and advises investors; in 1999, the same type of fund gained 7.9%.
Mr. Shopkorn, who says he made his decision to resign about two weeks ago, will leave Moore in the next few days. In an interview, the 57-year-old Mr. Shopkorn said he aims to spend more time with his family, and is "looking forward to not getting up at 4:30 a.m. every day."
But he also spoke of the challenging market environment. "The market isn't responding to what it normally responds to, like the Fed aggressively raising interest rates," he said. "The volatility in the market has also increased, both up and down, and normal corrections one might expect take place very quickly or just not at all."
Mr. Shopkorn gained renown as the longtime head of block trading in the 1980s at Salomon Brothers, where he embodied the firm's swaggering, risk-taking culture. He left in 1991 after the firm curtailed its risk taking in the wake of a Treasury-bond bidding scandal. After his own trading operation suffered losses in 1994, Mr. Shopkorn joined Moore in late 1995.
He said disagreements with Mr. Bacon, 43, didn't play a part in his departure. "We're two powerful people and, yes, we disagreed from time to time, but it had no part in my decision."
Elaine Crocker, president of Moore, said Mr. Shopkorn had fulfilled his original goal of building a stock team at Moore over a three- to five-year period. Although the firm has 25 professionals in equities, she said, "there's not going to be a successor. There's only one Stan Shopkorn." She predicted he would return to the markets in some way after taking some time off.
Some experts called the move another sign of tougher times for hedge-fund managers who make macro, big-picture bets on currencies and global markets, and who rode the U.S. stock market to high-octane gains over the past few years.
"This has been a bad month for all the global macro guys who reinvented themselves as having some stock expertise," said Jerome Abernathy, a former Moore employee who heads Stonebrook Structured Products LLC, a hedge fund and financial-engineering firm here which manages $300 million. "The hedge-fund business was once considered a glamor business, but it is not any more."
However, another hedge-fund specialist, Lee Hennessee, said she didn't think Mr. Shopkorn's departure would hurt Moore's performance. Mr. Bacon, she said "continues to have the biggest fund with the best return with the lowest volatility, and I don't think he will miss a beat." |
