When investors began lining up to redeem capital from his Claren Road Asset Management, Brian Riano offered an unusual response: He agreed to give them their money.
Claren Road's action comes at a time when hedge funds are increasingly raising gates and other roadblocks to investor redemptions as the rush to pull money out gathers momentum. While many of the funds facing redemption runs are posting negative returns, Claren Road is in the black. "We have decided to honor all redemption requests," Riano said. "We have a liquid portfolio, and we are in a good cash position."