Paul Tudor Jones’ investors are increasingly deserting him.
The billionaire macro manager who helped give rise to the hedge fund industry saw clients pull about 15 percent of their assets from his main fund in the second quarter, according to investors who asked not to be identified discussing private information. That’s left client assets at about $3.6 billion, almost half the value a year ago.
The withdrawals are a blow to Jones -- the Memphis native and former cotton trader who started Tudor Investment Corp. almost four decades ago -- and exemplify the asset bleed hurting the biggest names in the business, including Alan Howard and John Paulson. As clients flee amid investment losses, Jones has taken steps to revive his firm, including reducing fees and headcount.
Jones’ main BVI Global Fund is down 1.9 percent this year through July 21, according to a client document. The fund also manages money for Jones and his employees. Patrick Clifford, a spokesman for Tudor, declined to comment.
Jones, 62, and his brethren are experiencing a punishing shift. The old guard who shot to fame in the 1980s and 1990s are foundering, while a younger set of managers are making money, hiring and attracting new investments. The veterans are finding it’s no easy feat to replicate stand-out profits of yesteryear, when markets were more opaque and less efficient.
Macro Meltdown
Macro hedge funds have posted their worst first half since 2013, losing 0.7 percent, and on average returned about 1 percent annually in the past five years, according to Hedge Fund Research Inc.
Aside from BVI Global, Tudor also manages a fund tied to the performance of multiple teams of managers, an event-driven portfolio, and individual accounts. In total, the firm now has just under $8 billion in assets, compared with $14 billion in June 2015.
As revenue declines at Tudor, Jones last month sold the firm’s 43-acre Greenwich, Connecticut, headquarters’ property. Tudor said it plans to move to a location in lower Fairfield County that’s more convenient to New York City, where the firm has offices. It also has outposts in London and Singapore.
Tudor employees have also defected along with clients. Global rates money manager Adam Grunfeld quit in May after nine years and is set to join Element Capital, the macro fund run by 42-year-old Jeff Talpins. Zorin Finkelsen and Dudley Hoskin left to join Balyasny Asset Management. Other departures have included risk-management chief Joanna Welsh, who departed for Ken Griffin’s hedge fund Citadel last year.