‘Exceptional Trader' Rokos Attracts $500 Million From Blackstone

  • Rokos has about $500 million of his own money in the fund
  • He plans to pause money raising when he reaches $3 billion

Chris Rokos, described by his former boss Alan Howard as an “exceptional trader,” raised more than $500 million from Blackstone Group for his new hedge fund, according to two people familiar with the transaction.

Rokos started his Rokos Capital Management in London a month ago with roughly $1 billion -- about half from his own pocket and the rest from Blackstone. He’s since attracted other investors to the fund, which chases macro-economic trends in stocks, bonds and currencies. He plans to pause in his money-raising efforts when he hits $3 billion in assets.

Blackstone is making a large bet on Rokos, 45, as established macro hedge funds post lackluster returns, while other high-profile managers were forced to close after struggling to navigate markets. The private equity firm, which oversees $68 billion in its hedge fund business run by Tom Hill, is constantly on the lookout for talented managers with whom it can place big chunks of capital. Three years ago it gave more than $500 million to Peter Muller, who ran a computer-trading unit that spun out of Morgan Stanley.

Blackstone, based in New York, didn’t take a stake in Rokos’s firm, said one of the people, who asked not to be identified because the information is private. Spokesmen for Rokos and Blackstone declined to comment on the investment.

Rokos made his name and fortune at Brevan Howard Asset Management, the London-based firm he co-founded in 2002 with Howard and three other colleagues from Credit Suisse Group AG. Rokos traded his way to $4 billion in profits between 2004 and 2012. In at least three of those years his gains exceeded $900 million.

He left Brevan Howard in 2012 after losing $383 million, and last year sued the firm, seeking to void an employment agreement that prevented him from managing client money until 2018. Rokos and Howard settled the suit in January. Brevan Howard said at the time it would take a “financial interest” in the venture, without providing details.

Rokos is starting in a year when most of his rivals have posted disappointing returns, and macro funds run by Fortress Investment Group LLC and Bain Capital were forced to close, hit by market twists and turns that included an unexpected surge in the Swiss franc in January, a rally in European government bonds in April and the surprise devaluation of the Chinese yuan in August. He’s also raised money as Brevan Howard’s assets have shrunk 11 percent in the first nine months.

Macro hedge funds have lost 0.9 percent this year through September, according to data compiled by Bloomberg.

Rokos faces competition for clients from another new macro fund run by Scott Bessent, who has spent the last four years overseeing George Soros’s $30 billion fortune. He’s leaving the family office at the end of the year to start Key Square Group, which will manage $2 billion from Soros as well as money from other investors.

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