Citadel Said to Return 4.75% in January; First Gain Since June
By Saijel Kishan
Feb. 2 (Bloomberg) -- Citadel Investment Group LLC, the Chicago-based hedge-fund firm whose largest funds lost about 55 percent last year, in January posted its first gain in seven months, according to an investor.
The Kensington and Wellington funds, which together manage about $9 billion, returned an estimated 4.75 percent, said the person, who asked not to be identified because the information is private. Hedge funds lost about 1.2 percent in January, according to the HFRX Global Hedge Fund Index.
Citadel made money on wagers in stocks, macro and convertible-arbitrage strategies, the investors said. The firm generated profits as the Standard & Poor’s 500 Index of the largest U.S. companies declined 8.6 percent. U.S. Treasuries lost 3 percent, according to Merrill Lynch & Co. indexes.
“It’s taken a while for the larger hedge funds to exit losing strategies,” said Adam Sussman, director of research at Tabb Group LLC, a New York-based adviser to financial-services companies. “It’s difficult for them to make adjustments to their portfolios overnight.”
Katie Spring, a Citadel spokeswoman, declined to comment.
Citadel’s loss last year was its second since Kenneth Griffin, 40, started the firm in 1990. In December, Citadel limited investor withdrawals, a step also taken by rivals including Fortress Investment Group LLC and Tudor Investment Corp. as the industry produced its worst annual performance on record.
The Kensington and Wellington last rose in June, gaining about 0.8 percent, according to the investor.
Hedge funds, private and largely unregulated pools of capital, lost an average of 18 percent globally last year, according to Chicago-based Hedge Fund Research Inc.
To contact the reporter on this story: Saijel Kishan in New York at skishan@bloomberg.net
Last Updated: February 2, 2009 15:00 EST |
