Expansionary hedge fund continues to tap investment banks’ traders
Millennium Management has continued its London expansion, poaching senior traders, researchers and portfolio managers from JPMorgan, Morgan Stanley and Nomura as well as targeting other hedge funds for talent.
Andy Berner, who worked as a portfolio manager for JPMorgan’s chief investment office after joining from Tudor Capital in 2008, signed up to Millennium earlier this month as part of its ongoing expansion drive that has seen its UK headcount increase by 21% over the past 12 months.
This is not the limit of its recruitment from large investment banks, however. Aldous Birchall, head of systematic and quantitative credit trading within Nomura’s prop trading division, has joined as a portfolio manager within Millennium’s Fourier Capital Management offshoot – as has James Ter Haar, who was previously a partner and portfolio manager at Lucidus Capital Partners.
Millennium has also been poaching from investment banks for its research function. Marti Palosuo, who only joined RBC Capital Markets as a VP in its European industrials team in March, joined Millennium in September, as did Edward Peter-Hoblyn, who has been working as an analyst at Morgan Stanley for the past year.
Millennium Management, the $23bn hedge fund run by Izzy Englander, has been bolstering its London headcount for the best part of two years, taking advantage of the exodus of prop traders from investment banks as they’re forced to pull back from this activity. So far in 2014, 50 new front office employees have joined its UK office.
However, joining the hedge fund is something of a risk. Traders are given small amounts of capital to invest and are allowed to work across multiple strategies under a very strict centralised risk management committee overseen by senior management.
If you’re successful, more capital is given and – as traders are paid out of their own PnL – has the potential to be very lucrative. However, it also means that tenures can be short-lived, particularly for new hires.
Filings on the Financial Conduct Authority register suggest that, for example, the trio of portfolio managers to move across from Napier Park Global Capital in December – formerly Citigroup’s internal hedge fund – Alex Shaw, Mahmood Noorani and Krishnan Sadasivam (a former Brevan Howard partner), left Millennium in August after less than 10 months at the firm.