Ilex Capital Partners and Shiprock Capital Management, two rising hedge funds, have joined the list of high-performing firms who are limiting outside investments after successful fundraising and performance streaks, amid a wider industry trend of cash outflows, according to a report by Bloomberg.
Ilex Capital, one of the largest hedge fund start-ups of 2022, reached its $1.5bn target for additional funds by 1 October and immediately closed to new capital. The report cites an unnamed source familiar with the details as revealing that the London-based firm, which was founded by former Citadel traders Jonas Diedrich and Dave Sutton, now manages $4.1bn.
Shiprock Capital meanwhile, which launched with $80m in early 2022, is preparing to cap its assets at $1bn by early next year, according to an investor letter seen by Bloomberg, and will stop taking new subscriptions from January. The hedge fund has delivered an impressive 31% return this year through October, following a 32% gain in 2023.
Ilex’s equity long/short and market-neutral strategies returned 15.3% through October, outperforming the industry average of 8.4%, as reported by PivotalPath.
The moves align with a trend among top-performing hedge funds, which have opted to limit inflows to maintain performance quality and asset balance. Major multi-strategy funds, including Millennium Management and Citadel, have also returned substantial amounts to investors, seeking to preserve optimal asset sizes and profitability.
Other funds have taken similar actions recently. Kite Lake Capital Management closed its KL Special Opportunities Fund at $1.65bn on October 1, while Astaris Special Situations Master Fund, led by Martin Beck, is also preparing to limit new cash inflows when assets reach €1 bn ($1.1 bn).
