Billionaire investor Julian Robertson is shutting a portfolio that let outsiders bet with him on would-be star managers and has exited entirely from former protégée Nehal Chopra's Ratan Capital Management, according to recent regulatory filings.
The closure of Tiger Management Advisors LLC's six-year-old Tiger Accelerator Fund comes after poor performance and sharp declines in assets at its underlying hedge fund firms.
For now, it marks the end of retired hedge fund legend Robertson's side-business of gathering other people's money to invest in smaller hedge funds, even though he left open the possibility of pursuing such a strategy again.
For nearly two decades, Robertson has made investments with roughly three dozen hedge funds, including a number run by his former employees, whose firms are often referred to as 'Tiger Cubs,' in a nod to the name of Robertson's hedge fund Tiger Management.
The Tiger Accelerator Fund was unusual in that it grouped six such individual funds together and allowed investors, who might not be able to afford getting into some of the other funds that Robertson backs, to track the billionaire's best new prospects. The fund gave them stakes as limited partners and let them share in the revenue.
It managed just $28.5 million of outside capital as of Dec. 31, 2016, according to a Securities and Exchange Commission filing made on March 30. That is down more than 90 percent from $450 million at its launch in 2011, which marked Robertson's return to accepting outside capital, a practice he had ended in 2000 when he shut his hedge fund.
A spokesman for Robertson, 84, declined to comment.
Tiger Accelerator joins the growing list of failed hedge funds hurt by investors flocking to the exits in the face of high fees and sluggish returns. Data from Hedge Fund Research show 1,057 portfolios shuttered last year, the most liquidations since 2009.
Among the latest wave of managers supported by Robertson, the reversal of fortune at Chopra's Ratan Capital Management has been particularly stark. Her fund, named after the Hindi word for jewel, grew quickly to manage more than $1 billion, with capital from a public pension fund in New York and the family foundation of Robert Kraft, owner of the New England Patriots.
Working in the same Park Avenue, New York City building as Tiger, Ratan produced three straight years of double-digit gains until a big bet on drugmaker Valeant Pharmaceuticals International Inc soured and hurt the fund in 2015 and 2016. The fund managed just $375 million as of Dec. 31, according to its latest regulatory filing.