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]
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
call the cobbler!
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.
@ 1 – wideclops at MS…
@ 3 – long SD
@3 every asset class
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.
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.
@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.
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.
Kenny… a song for you… http://www.youtube.com/watch?v=1NvgLkuEtkA
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?
@3 one word, Leverage
title is money
@13, not exactly.
its really 4 words: ten turns of leverage
@13, not exactly.
its really 4 words: ten turns of leverage
never send to know for whom the bell tolls; it tolls for thee.
I wonder if the WSJ will be asked – no, instructed – to pull the story.
hedge
ep,
Patton references? Who are you?!?!
@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
@4 POST OF THE DAY!
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.
@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.
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
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
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.
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.
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.
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.
29 – Hull went to Goldman
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.
you may have noticed that JPM is also on round X of layoffs over there
It is ok.
They just suspended redemptions.