Redemptions

The sweep-up begins

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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