It’s been the best start to a year for hedge funds in a decade, and the returns for the biggest multi-strategy money managers are in.
Ken Griffin, who runs the $30 billion hedge-fund firm Citadel, is beating his largest rivals, gaining 13.6 percent in the first six months of the year in his flagship funds, according to a person with knowledge of the matter. Those funds, Kensington and Wellington, are market neutral — so their bullish wagers are matched by bearish ones. All five of the strategies that feed into them made money over the period, said the person.
Multi-strategy hedge funds, on average, gained about 6 percent in the first six months of the year, according to Hedge Fund Research. The industry overall is reporting its best start to a year in a decade, gaining 5.7 percent in the period, HFR data show. The S&P 500 index jumped about 19 percent during that time, with dividends reinvested.
In June, Citadel’s Kensington and Wellington rose 0.9 percent, led by gains in fixed income and macro as well as commodities. The firm’s Tactical Trading fund, a separate multi-strategy fund that employs equity and quantitative strategies, gained 1 percent in June, bringing year-to-date returns to about 12 percent, said the person. Citadel’s multi-manager platform counts on small teams of traders to manage money independently from one another.
After boasting the biggest hedge-fund startup ever, Michael Gelband’s performance has been underwhelming so far this year. His ExodusPoint Capital Management gained 3.3 percent in the first half, a person said. The one-time heir apparent to Millennium Management founder Izzy Englander is now trailing his former employer by about 1 percentage point. Carlson Capital’s Double Black Diamond fund is up just 1.7 percent after losing money in June.