Hedge Fund Man Group Said to Shut Quant Incubator After a YearBy
Five money managers said to depart firm following closure
Quant trade unit was set up to develop new money-making ideas
Man Group Plc has shut a quantitative trading unit after deciding to focus on other strategies, according to a person with knowledge of the matter.
The “quantitative incubating” unit, part of Man Group’s $18.8 billion AHL division, was opened about a year ago to develop new ways to make money, the person said, asking not to be identified because the information is private. The Oxon unit, led by Francois Moreau and Jaco Vermaak, gave internal capital to individual fund managers to use mathematical models to trade across asset classes. Moreau and Vermaak will stay at the firm and the five money managers at the unit have left, the person said.
The traditional computer-driven hedge funds at Man are unaffected by the closing, the person said. A spokeswoman for the world’s largest publicly traded hedge fund firm declined to comment.
Stung by poor performance and investor withdrawals, money managers across the globe are scrambling to take advantage of a world awash in data by using cheaper and faster computers to develop new trading strategies. Managed futures funds, which use algorithms to trade, were the only strategy to raise capital last year when the hedge-fund industry suffered $112 billion in outflows, according to data compiled by eVestment.
Man Group, which managed a record $88.7 billion in assets at the end of March, has reshuffled its investment team under chief executive Luke Ellis since last year. Earlier in March, Steve Roth, the head of credit and convertibles business at the firm’s GLG unit, stepped down from his role as a portfolio manager. The money manager also axed the role of chief risk officer following the departure of Jonathan Eliot.
— With assistance by Suzy Waite