business

Rokos Overtakes Howard as Billionaire's Clients Pull Money

Updated on
  • Brevan Howard’s AUM have dropped more than 75% from their peak
  • Investors are pulling money from firms to bet on startups
Chris Rokos’s investment firm now manages more money than Brevan Howard. Bloomberg’s Jason Kelly reports.

The protege has overtaken the master.

Chris Rokos’s investment firm manages more money than Brevan Howard Asset Management for the first time as clients continue to quit billionaire Alan Howard’s hedge fund company.

Rokos, who co-founded Brevan Howard and made $4 billion for the firm from 2004 to 2012, oversaw $8.2 billion at the end of March, according to a person with knowledge of the matter. Brevan Howard managed $8 billion on April 1, according to the firm’s website, a fall of more than 75 percent from its peak in 2013.

Spokesmen for London-based Rokos Capital Management and Jersey-based Brevan Howard declined to comment. Rokos’s assets have swelled from $3.5 billion in 2016, the first full year of trading by the fund.

Shrinking Assets

Money managed by Brevan Howard Master Fund

Source: Investor documents

2018 data is through March

Years of middling performance have made investors pull money from some of the oldest and most established macro traders including Brevan Howard, Tudor Investment Corp. and Caxton Associates. Recent hedge fund startups from Glen Point Capital to Amia Capital have raised billions of dollars between them as asset owners bet that new companies will outperform as volatility returns.

Prior to starting his firm, Rokos sued Brevan Howard seeking to void an agreement that restricted him from managing outside investors’ money until 2018. Brevan Howard counter-sued and the two sides settled in 2015, with the hedge-fund firm agreeing to take an undisclosed stake in Rokos’s startup. The 47-year-old has a net worth of about $1.2 billion, according to the Bloomberg Billionaires Index.

Brevan Howard’s flagship fund, which oversees $4.5 billion, gained 0.2 percent during the first quarter following its worst year on record, according to a letter to investors. To turn things around, 54-year-old Howard started his own fund to make riskier bets and also allowed a number of his top managers to run their own pools again.

Howard’s own fund gained about 7 percent in the first two months of this year and Rokos’s fund returned 10.5 percent in the same period. By comparison, macro hedge funds gained on average 0.3 percent, according to data compiled by Eurekahedge.

Chris Rokos, described by Howard as an “exceptional trader,” raised his initial capital from investors including Blackstone Group LP and has occasionally opened the fund to new money since then.

— With assistance by Suzy Waite

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