Hedge Funds

  • 16 Oct 2014 at 2:36 PM

Steve Cohen Makes Money For Steve Cohen

Point72 Asset Management, AKA the hedge fund formerly known as SAC Capital, whose largest client by far is a guy who answers to the name Steve Cohen, has turned in some pretty decent performance so far this year, despite a series of events that have led it to do stuff like, among other things, monetarily compensate employees for staying on the right side of the law. Read more »

Time was, the unofficial policy at (the hedge fund formerly known as) SAC Capital was that one could earn a pretty penny come bonus season if one made the firm a ton of money, and if that money happened to be made through material non-public information well…whatyougonnado? At SAC Capital 2.0 AKA Point72 Asset Management, however, insider trading is not only frowned upon, it’s both officially and unofficially a bad idea and one that could cost you big time on payday (though one would obviously be fired before that, unless payday is the day they get caught).

But just because the company handbook has been rewritten, or Steve Cohen has held a town hall where the words “If we catch you insider trading, I’ll stick my hand down your throat and rip out your spleen” have exited his mouth, or the hedge fund’s propriety trading software has been rewired so that a cartoon Cohen pops up on the screen and says “Remember, I can make it look like an accident” before any trades are placed, doesn’t mean that people can change their ways in a day. Old habits die hard, particularly at a place where those old habits could score you 8 figures a year.

Which is presumably why* someone at Point72 came up with this: Read more »

Over at the New Yorker today, you will find a long piece exploring the coming undone of the hedge fund formerly known as SAC Capital, now Point72 Asset Management, at the hands of a trader formerly known as Ajai Thomas, now Mathew Martoma. Although nearly a dozen ex-SAC employees have been charged with and convicted of securities fraud over the last several years, it was really the work of work of Martoma, accused in November 2012 of orchestrating “the largest insider trading scheme ever” and found guilty last spring, that was the straw that broke the embalmed shark’s back. Particular details to note:

* While SAC has a history as an extremely cutthroat place to work, where the “down and out” clause means traders are cut loose swiftly and without hesitation, and insults from on high are in no short supply, it was no match for the household of Martoma’s youth, headed by a guy who could teach Steve Cohen a thing or two.

When Martoma’s father first came to America, he was admitted to M.I.T., but he could not afford to attend. He retained a fascination with Cambridge, however, and prayed daily that his oldest son would go to Harvard. Martoma graduated from high school as co-valedictorian, but he ended up going to Duke. Shortly after Mathew’s eighteenth birthday, Bobby presented him with a plaque inscribed with the words “Son Who Shattered His Father’s Dream.”

* Steve Cohen has continued his long and storied tradition of displaying once-living things in boxes at the 72 Cummings Point Road headquarters.

S.A.C. was a notoriously intense place to work. Its headquarters, on a spit of land in Stamford, Connecticut, overlooking the Long Island Sound, are decorated with art from Cohen’s personal collection, including “Self,” a refrigerated glass cube, by Marc Quinn, containing a disembodied head sculpted from the artist’s frozen blood.

* That anecdote that circulating a while back about how Martoma had fainted on his front lawn when approached by the Feds? It wasn’t the mere sight of them, or some sort of line about how they knew he’d been trading on material non-public information that caused him to collapse, but rather this: Read more »

  • 29 Sep 2014 at 4:38 PM

David Einhorn Just Came Into Some Bagel Money

The Einstein Noah Restaurant Group, whose bagel shops include Einstein Brothers Bagels, Noah’s New York Bagels and Manhattan Bagel, said on Monday that it would sell itself to JAB Holding Company, a German conglomerate formerly called Joh. A. Benckiser, for about $374 million. The price of $20.25 a share in cash represents a 47 percent premium over Einstein Noah’s 30-day average trading price, the company said…David Einhorn, whose hedge fund is Einstein Noah’s largest shareholder, with a stake above 35 percent, said he supported the sale to JAB. He called the deal a “win-win for all parties.” “For more than a decade, we have worked closely with the Einstein Noah Restaurant Group to execute a turnaround plan, reducing debt and expanding its store footprint,” Mr. Einhorn said in a statement. “J.A.B. is an experienced firm that will lead Einstein Noah Restaurant Group into its next phase of growth.” [Dealbook]

Things Still Awkward Between CalPERS, Hedge Funds

Hedge funds might be feeling pretty down in the dumps about CalPERS’ decision to break it off with them. OK, so probably not, but the point is that CalPERS is afraid it might have hurt their feelings, and it’s been beating itself up about it. You see, hedge funds, it’s not you, it’s CalPERS. Sure, it’s an old cliché but it’s true! You’re great. It’s just that CalPERS has had some new experiences and just needs to make a change. You know how it goes. Read more »

If there are people out there who don’t enjoy being broken down emotionally by their coworkers as a means of ultimately emerging stronger, he hasn’t heard of them. Well, okay, he’s heard of some but they quickly adjust to the Bridgwater way of doing things after a short 18 months. Read more »

Failure to “adhere to a clear breadstick policy” is one of the many, many things Olive Garden is doing wrong, according to a new presentation by Starboard Value. Read more »