Hedgeweek Comment: Hedgies are doing it for themselves
Yesterday, a former Bear Stearns hedge fund manager opened her own firm with nearly USD1bn in assets. Melissa Ko, who generated annual returns of more than 25 per cent while running the Emerging Markets Macro Fund at Bear Stearns between 2005 and 2007, has now struck out on her own with New York-based firm Covepoint Capital.
Ko was part of the Bear Stearns Asset Management division that managed around USD27bn when the group was acquired by JPMorgan Chase after pessimistic market sentiment pushed it to the verge of a liquidity crisis.
She is just one of many members of the financial services industry who have seized the disruption unleashed by the credit crunch as an opportunity to quit salaried employment and take up the challenge of being their own boss.
Newcomers to the industry include many former bankers. Earlier this month, two former heads of fixed-income at Citigroup, Randy Barker and Geoff Coley, announced they were launching a hedge fund. Back in April, GLG's star emerging markets manager Greg Coffey decided to walk away from USD250m in share options and bonuses to start his own business when he quits the firm in October.
More than 45 traders, bankers, analysts and other executives have left investment banks this year to join hedge funds and private equity firms, according to Bloomberg. That's even before you include people starting their own companies, suggesting that reports of a slowdown in the alternative investment industry may be somewhat exaggerated.
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