Goldman Sachs Traders Join Citadel in Hedge Fund Migration

Two Goldman Sachs Group Inc. (GS) managing directors are leaving for Citadel LLC, joining the migration of traders leaving Wall Street banks for hedge funds as lenders pull back from riskier businesses.

Uberto Palomba, Goldman Sachs’s co-head of emerging markets trading for Europe, the Middle East and Africa, will join Citadel’s Global Fixed-Income Fund in London, Katie Spring, a spokeswoman for the Chicago-based hedge fund, said by telephone. Jonathan Tipermas, who led Goldman Sachs’s dollar swaps-trading desk, will work for the fixed-income fund in New York, she said.

Citadel is expanding the fixed-income operation it started after hiring former JPMorgan Chase & Co. proprietary trader Derek Kaufman in 2008 to widen its range of funds beyond Kensington and Wellington, its two biggest pools. The hedge fund has built the unit by hiring from lenders including Bank of America Corp. and Credit Suisse Group AG, which have seen traders leave since the financial crisis of 2008 as regulators press firms to cut back their proprietary-trading activities.

Palomba, 39, joined Goldman Sachs in 2007 from Morgan Stanley (MS), according to his registration with the U.K.’s Financial Conduct Authority. The bank named him a managing director in 2009, according to a Bloomberg News story at the time. Tipermas, who is based in New York, joined in 2004 and was named a managing director in 2012. Neither could be reached by telephone at their offices, while e-mails were returned. Spokesmen for the bank declined to comment on the departures.

Fixed-Income

Citadel’s fixed-income fund, which manages $2.2 billion, gained 5 percent in January after climbing about 20 percent in 2013, according to a person with direct knowledge of the performance who asked not to be identified because the fund is private. Hedge funds fell 0.14 percent on average last month and posted a 7.4 percent gain in 2013, according to data compiled by Bloomberg. Kaufman’s team also manages money for Kensington and Wellington, the person said.

To contact the reporters on this story: Jesse Westbrook in London at jwestbrook1@bloomberg.net; Ambereen Choudhury in London at achoudhury@bloomberg.net

To contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.net

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