Citadel down 13% in November, making their YTD something like -47%. Please, I want to get off the ride now. Please?
Citadel's mounting losses have come from declining values of convertible bonds, bank loans and other investments as global markets strain. Much of the losses stemmed from credit holdings during the last week of the month, investors say.Continued pressure on those assets, particularly as other hedge funds fail and are forced to dump positions to raise cash, is compounding Mr. Griffin's efforts to engineer a rebound during what is by far his firm's worst year ever.
Citadel, which manages roughly $16 billion, has cut about 20 employees in its trading operations in recent weeks, including some in London, and also is trimming its back-office and human-resources rolls by roughly the same number, according to people familiar with the matter. Citadel has about 1,300 employees world-wide.
Citadel Down 13% in November [The Wall Street Journal]
Posted by guest , Dec 04, 2008 1:44PM
everytime i read about Citadel it reminds me of this post at leveragedsellout.com, a while back...
Which would you rather be?
(A) An M&A MD at Jeffries
(B) A PWM VP at Bear
(C) A trade settlement analyst at Lehman
(D) A HR intern at GS
(E) A janitor at Citadel
Posted by guest , Dec 04, 2008 1:50PM
call the cobbler!
Posted by guest , Dec 04, 2008 1:50PM
Anyone know on what trades they lost SO much? To go from down 4% to -47% in 3 months is just shocking for a fund like Citadel.
Posted by guest , Dec 04, 2008 1:52PM
@ 1 - wideclops at MS...
Posted by guest , Dec 04, 2008 1:54PM
@ 3 - long SD
Posted by guest , Dec 04, 2008 1:59PM
@3 every asset class
Posted by guest , Dec 04, 2008 2:03PM
haha, arrogant pricks deserved it! Firstly bought Quant models from Thorpe and then jumped into loans and mortgages. Only thing original they did was Convert Arb and it sucked big in 2005-2006.
Posted by guest , Dec 04, 2008 2:04PM
3 The world has changed in the last three months. Add a little leverage and going from +4 to -47 is not shocking at all.
Posted by guest , Dec 04, 2008 2:06PM
@3....yeah pretty much being a multi-strat with exposure to just about all asset classes (and a legacy focus on converts) was a recipe for meltdown this year.
Posted by guest , Dec 04, 2008 2:12PM
Traders don't lose money; ...... "declining values of convertible bonds, bank loans and other investments as global markets strain, particularly as other hedge funds fail and are forced to dump positions to raise cash" do.
Posted by guest , Dec 04, 2008 2:13PM
Kenny... a song for you... http://www.youtube.com/watch?v=1NvgLkuEtkA
Posted by guest , Dec 04, 2008 2:20PM
Serious question:
When the WSJ reports that Citadel manages $16B, but that it's down 47% - does that mean that Citadel only has about $8B now - or does it mean that Citadel used to have $32B, now down to $16B - or is it something else entirely?
Posted by guest , Dec 04, 2008 2:21PM
@3 one word, Leverage
Posted by guest , Dec 04, 2008 2:23PM
title is money
Posted by guest , Dec 04, 2008 2:24PM
@13, not exactly.
its really 4 words: ten turns of leverage
Posted by guest , Dec 04, 2008 2:28PM
@13, not exactly.
its really 4 words: ten turns of leverage
Posted by guest , Dec 04, 2008 2:41PM
never send to know for whom the bell tolls; it tolls for thee.
Posted by guest , Dec 04, 2008 2:48PM
I wonder if the WSJ will be asked - no, instructed - to pull the story.
hedge
Posted by RamblinWreck , Dec 04, 2008 3:04PM
ep,
Patton references? Who are you?!?!
Posted by guest , Dec 04, 2008 3:11PM
@19, n00b :)
seriously though, when you are losing billions at a swipe why even bother canning a few lousy traders whose combined salary is barely a rounding error?
if anything 20 firings at CIG is probably below the weekly average under normal circumstances
Posted by guest , Dec 04, 2008 3:20PM
@4 POST OF THE DAY!
Posted by guest , Dec 04, 2008 3:42PM
Can we just roll Citadel, Fortress, and all the other HFs named for fixed fortifications into one firm, called Maginot Line Capital, and then ask the Germans to bulldoze it?
Just a thought.
Posted by guest , Dec 04, 2008 3:52PM
@20 - The forty people being fired are probably the ones who spoke up and told Kenny G. that it would be best for the firm if he took the bullet.
Posted by guest , Dec 04, 2008 4:03PM
KG has already had a lot of personal loss in this firm, I don't think he has enough money to buy out all the losses of the investors if that is what you mean
Posted by Seaman Bodine , Dec 04, 2008 4:12PM
Wasn't it funny that KG got an invite to sit with Simons, Paulson, Soros, and Falcone, when even then everyone knew he was fucked. JS probably made him go buy smokes.
It's like that scene in Entourage when Ari meets all the other agency heads. And then he looks at the KG equivalent, and says, "who the fuck invited APA?"
http://www.youtube.com/watch?v=nxAfMeZ2jLM
Posted by guest , Dec 04, 2008 4:23PM
I really thought Citadel was going to blow up in November.
The 40 or so people let go are the lucky ones. They will get the best packages. In January, there may be nothing left.
Posted by guest , Dec 04, 2008 4:35PM
So, maybe in retrospect, Mr. Jeff Larson's sale of Sowood to Citadel wasn't so bad...if memory serves, he shut down the shop at around a down -47% number--and investors got their money back. The real issue here is the street; most HFs have unwind triggers to their financing at down -40% or so...and that's a total NAV concept, so -47% PLUS the announced redepmtion of 10% or so means that on an NAV basis, the relevant funds will be close to DOWN 60%.
Citadel probably had better terms than most funds (The Big C is a notorious street-bender-over) but not only is the C sweating triggers, but the remaining few employed hf credit officers on the street are doing the same.
Posted by guest , Dec 04, 2008 4:45PM
Equity stat arb from Thorpe
Options Market Making from Hull
Energy group from Aquilla
Fixed Income from Solly, Boa, now JPM
Fundamental credit from CSFB
Other than convert Arb, what has Ken done but build a house full of punters who rip people like Amaranth and Etrade off??? The Del is Done.
Posted by guest , Dec 04, 2008 4:52PM
Equity stat arb from Thorpe
Options Market Making from Hull
Energy group from Aquilla
Fixed Income from Solly, Boa, now JPM
Fundamental credit from CSFB
Other than convert Arb, what has Ken done but build a house full of punters who rip people like Amaranth and Etrade off??? The Del is Done.
Posted by guest , Dec 04, 2008 5:47PM
29 - Hull went to Goldman
Posted by guest , Dec 04, 2008 8:01PM
How hard is JPMorgan laughing at all their top prop traders who left over the summer to join Citadel? At the time they were so pissed they refused to trade with Citadel for a while over it. Now those guys couldn't get jobs in the mailroom at JPM.
Posted by guest , Dec 05, 2008 1:54AM
you may have noticed that JPM is also on round X of layoffs over there
Posted by guest , Dec 05, 2008 2:30AM
It is ok.
They just suspended redemptions.