The Check is in the Mail
Are you hungry young manager looking to start a hedge fund? Everyone is doing it after all....we used to be a nation of hamburger flippers before we became a nation of hedge funds.
Ken Griffin and Citadel can help. They are starting a new subsidiary to diversify and expand their business. Undiscovered managers might want to read on.....
Citadel is looking less and less like its original self. Founded in 1990 as a convertible arbitrage hedge fund, the group is also an options marketmaker, a hedge fund administrator and its latest venture is a fund of hedge funds business that will also seed new managers.
The Chicago-based group has set up Citadel Alternative Asset Management as a separate subsidiary.
Running a fund of hedge funds alongside Citadel’s $13bn (€9.5bn) in proprietary funds was not an option because of conflicts of interest. The new unit will provide commercial diversification from its in-house funds.
To start the new business, Citadel’s partners have invested about $500m, according to sources.
It hired Jon Venetos, who ran Deutsche Asset Management’s fund of hedge fund business in New York at the beginning of this year. Venetos will also be working on launching the incubator funds business.
He joined Deutsche’s absolute return strategies group in 2003 from Merrill Lynch Investment Managers and will be building a team of analysts.
Citadel joins a growing number of fund of hedge funds that have gone into the incubation business. Blackstone launched its effort last November under Gideon Berger in London and FRM is setting up a unit. Citadel has hired Matt Wilson as head of sales and marketing for Citadel Solutions, the new administration business, and Citadel Alternative Asset Management this month. He joined from Bank of America, where he was global head of prime brokerage sales.
This latest move suggests Citadel, which became the first hedge fund to issue bonds in the public market last December, is looking at greater expansion. Financial News
You had better bring a culture of risk management to the table if you want a check from Ken. And don’t call him a gerbil either...that could quash your chances.
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