Hedge Funds

Pequot's performance problem


The SEC investigation is over, but limp returns may be the real barrier to growth

Pequot Capital Management has spent the past two years carrying out 65-year-old founder Art Samberg's plans to convert his storied hedge fund into a multimanager platform capable of perpetuating his legacy.

That goal could not have been helped by a two-year probe of the firm, discontinued this October, during which the U.S. Securities and Exchange Commission investigated claims of insider trading. Pequot emerged unscathed from the investigation, and persevered, adding strategies and staff. But despite its efforts, asset growth has been slow. Some institutions