Saturday, 28 May 2016
Last updated 3 hours ago
Apr 26 2010 | 12:07pm ET
In the first quarter of last year, Knight Capital Group got rid of its troublesome hedge fund unit, Deephaven Capital Management. In the first quarter of this year, that move paid off in a big way.
The Jersey City, N.J.-based brokerage said its profits for the first three months of the year tripled from the same period last year, despite lower trading volume. Knight earned $27.8 million in the first quarter as revenue jumped 16% to $284.2 million.
The firm would have earned even more last year had it not been for Deephaven. Knight’s profits for last quarter came out to 30 cents per share. In the previous first quarter, it had been 10 cents a share—after a 23-cent-per-share loss attributable to the sale and closure of Deephaven.
Last January, Deephaven agreed to sell the assets of its flagship hedge fund to Stark Investments. The firm then closed its doors.