The sweep-up begins

Mon Feb 2, 2009



As managers suspend withdrawals and the Madoff scandal lingers, investors say "it's time to push the ocean back"


As managers suspend withdrawals and the Madoff scandal lingers, investors say "it's time to push the ocean back"

By Michelle Celarier

When Cerberus Capital Management shifted from distressed investing to private equity years ago, it was in the vanguard of a new trend that many hedge funds later adopted, hoping it would lift their flagging returns. Today Cerberus's once-brilliant move puts it on the cutting edge of another, but less desirable, trend. With performance off more than 20% for the year in its hedge funds, Cerberus told investors in December that it would invoke a little-noticed clause in its documents that allows it to defer redemptions for up to a year.



Cerberus, which received requests from investors in one hedge fund to withdraw what amounted to a total of 16.5% of its net asset value as of November 30, is only one of dozens of hedge funds that decided...

ISSN: 2151-1845 / CDC10004H

Register

By registering you will receive

  • A monthly newsletter on your specified areas of interest
  • A fortnightly update on the sector

Free Trial

Take a trial today and access

  • Performance news, fund launches, regulation changes and people moves
  • Profiles of fund managers, investors and distributors
  • Live league tables
  • Investor mandates


Popular Searches on HFI