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Citadel Chief Denies Rumors of Trouble
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Citadel, a large hedge fund headed by Kenneth Griffin is having problems, with its flagship fund down 35% this year. And the rumor mill saying some of its funds are down 60% and Fed Reserve officials are visiting the fund. Citadel is leveraged 3 to 1 and this is down from higher levels . Ironically Griffin has been known for buying other companies assets for pennies on the dollar, including E Trade and hedge funds Sowood Capital. And where did Griffin get started? He started trading in his dorm room at Harvard in the eighties. The hedge fund $1.7 trillion industry is facing a shakeout. It has already lost $180 billion in the August-October 2008 period and some hedge funds face collapse.
A hedge fund story of fall and recovery- Ken Griffin of Citadel hedge fund in 2008 and in 2015
10/25/2008
Citadel had leverage of $3 in borrowed funds for $1 of client money in 2008 to make investments. It nearly collapsed in the 2008 financial crisis with losses ranging from 35-60%, losses of $8 billion. In 2015 it has $7 of borrowed funds for $1 of client money for investments, according to the WSJ. It now makes investment bets equally in up and down markets to offset the higher risk, so that only 52% of the bets need to work. It recovered during the last crisis by barring investors from withdrawing money for 8 months. By taking aggressive positions early in the recovery of the market Citadel made $3 billion in 2013-2015. Many of the hedge funds are now less aggressive than Citadel following the 2008 financial crisis, preferring to target smaller returns and improve the image with clients such as college endowments and pension funds.
Grouped Articles
Citadel’s Ken Griffin Leaves 2008 Tumble Far Behind
Wall Street Journal 08/04/2015
Citadel Chief Denies Rumors of Trouble
New York Times 10/25/2008
Kenneth Griffin and his Citadel hedge fund.
10/25/2008
Citadel lost $8 billion of its investors (pension funds, endowments and the superrich) in 2008. In 2009 he is trying to get investors back to his fund but is meeting resistance from those who remember the losses in 2008.
Grouped Articles
Hedge Funders Are All a Little Nuts
Wall Street Journal 08/27/2013
Citadel’s Ken Griffin Leaves 2008 Tumble Far Behind
Wall Street Journal 08/04/2015
Citadel Chief Denies Rumors of Trouble
New York Times 10/25/2008
A Hedge-Fund King Comes Under Siege
Wall Street Journal 11/20/2009
In Lieu of Bailout, a New Strategy
New York Times 01/19/2009
Ben Bernanke, post-Fed role as advisor at Citadel Hedge Fund
10/25/2008
Grouped Articles
Ben Bernanke Will Work With Citadel, a Hedge Fund, as an Adviser
New York Times 04/16/2015
Wall Street Journal 05/08/2015
Citadel’s Ken Griffin Leaves 2008 Tumble Far Behind
Wall Street Journal 08/04/2015
Citadel Chief Denies Rumors of Trouble
New York Times 10/25/2008
A hedge fund story of comeback from collapse- Citadel hedge fund and founder Ken Griffin in 2008 and in 2015
10/25/2008
Linked Articles
Citadel’s Ken Griffin Leaves 2008 Tumble Far Behind
Wall Street Journal 08/04/2015
Citadel Chief Denies Rumors of Trouble
New York Times 10/25/2008
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