Weintraub Capital Management LP, the $1 billion San Francisco-based long-short equity hedge fund, will return money to investors and become a family office overseeing the wealth of founder Jerry Weintraub.
“Like lots of big decisions, it’s not any one particular thing, it’s a process,” Weintraub said today in a telephone interview. “It’s been a great run for myself and for my co-workers, and for a variety of reasons we decided it was best to wind down.”
Weintraub, 53, who started the firm in 1992, declined to specify what led to his decision.
In this year’s first half, 424 hedge funds were liquidated, according to Chicago-based Hedge Fund Research Inc. Liquidations climbed to 775 last year, the most since 2009. Long-short equity funds, whose managers can bet on rising and falling stocks, gained 1.5 percent this year through October, according to data compiled by Bloomberg, compared with a 14 percent return for the Standard & Poor’s 500 Index, including reinvested dividends.
Weintraub Capital Management advanced 3 percent in 2012 through October and had only two years of negative returns during its two decades, falling about 3 percent both times, he said. The fund averaged annual gains “in the low teens” since inception.
Investors will receive 90 percent of their capital by year-end and the rest after an audit to be held in March or April, Weintraub said.
Weintraub employs 14 people, four of which are administrators. Some of the administrators will be retained for the family office and the investment employees won’t be, he said.
A family office is a company that manages investments or trusts for one or more families.