Perry’s Assets Plunge 60% to $4 Billion as Wagers BackfireBy and
Perry Capital managed $10 billion in assets in September 2015
Main hedge fund lost 2.6% in first seven months; 12.6% in 2015
Perry Capital, the 28-year-old hedge fund run by Goldman Sachs Group Inc. alumnus Richard Perry, has lost more than half of its assets in less than a year after posting declines since 2014.
The firm’s assets slumped to $4 billion as of the end of August compared with $10 billion in September last year, according to a person with knowledge of the matter. Perry, based in New York, has posted losses of 18.4 percent from the beginning of 2014 through July of this year, an investment document shows. The fund declined 2.6 percent in the first seven months of this year after losing 12.6 percent in 2015.
Michael Neus, general counsel at Perry Capital, didn’t return calls and e-mails seeking comment.
Perry Capital is among the managers including Tudor Investment Corp. and Brevan Howard Asset Management that have seen investors flee. The $2.9 trillion hedge-fund industry has come under fire this year for everything from excessive fees to lackluster returns, with investors pulling the most money since the aftermath of the global financial crisis.
Perry Capital follows an event-driven strategy, wagering on corporate actions such as takeovers and bankruptcies.
The firm had never had a losing year from its 1988 inception through 2007, when it managed $14 billion. Perry, 61, had previously worked on Goldman’s risk-arbitrage desk, which was once led by Robert Rubin, who later became U.S. Treasury secretary. The team spawned a group of hedge fund managers that included Frank Brosens, who co-founded Taconic Capital Advisors, and Eric Mindich of Eton Park Capital Management.
Hedge funds returned an average of 3.5 percent this year through August, according to Hedge Fund Research Inc.
— With assistance by Katherine Burton