Ilex Capital Partners, one of the major hedge fund startups of last year, is in discussions to raise an additional $1.5bn in investment capital by the end of 2024, according to a report by Bloomberg.
The report cites unnamed sources familiar with the matter as revealing that the firm, led by former Citadel traders Jonas Diedrich and Dave Sutton, plans to mobilise new capital from existing investors.
Since opening to external clients on 1 July, 2023, Ilex Capital Partners has seen significant growth, and now manages approximately $2.36bn. The fund has returned 10.4% during its first 12 months of managing external capital and saw a 6.6% return in the first half of this year, surpassing the average 8% gains made by equity hedge funds tracked by Bloomberg over the same period.
Diedrich’s strategy at Ilex, which mirrors the approach he utilised at Citadel, focuses on equity long-short, market-neutral and factor-constrained investments. The fund concentrates on European securities and operates multiple trading books run by portfolio managers specialising in consumer staples, consumer discretionary, healthcare, industrials and financial-sector stocks.
While the hedge fund industry has faced withdrawals amounting to $40.6bn through April 2024, multi-strategy firms like Ilex, employing multiple teams of traders across various asset classes, have continued to attract capital. Notably, Bobby Jain and Diego Megia have collectively raised over $10bn for their hedge fund startups this year.
Ilex Capital Partners initially raised capital from investors, including a $500m investment from Woodline Partners. The firm was one of the largest hedge fund startups in 2023, alongside Mala Gaonkar’s SurgoCap Partners, which started with $1.8bn, and a $3bn spin-out by a group of Moore Capital Management traders led by Joeri Jacobs.
