SAC Not Sweating Redemptions

Dec 2 2010 | 1:57pm ET

Most hedge funds begin to fear for their very lives when they are mentioned in connection with insider-trading or any federal investigation. Even top firms, such as FrontPoint Partners, can see billions in redemptions.

But as with seemingly so many other things, SAC Capital Advisors may stand apart.

The $12 billion hedge fund giant has been subpoenaed in the Justice Department's growing insider-trading investigation. As part of that probe, the Federal Bureau of Investigation asked the head of a research firm to wear a wire in conversations with SAC. And two hedge funds founded by SAC alumni—including one founded by SAC founder Steven Cohen's brother-in-law—were raided last month.

But while SAC may be a target of the investigation, it may well take an indictment to sink it. The firm allows investors to withdraw only a quarter of their money every three months, MarketWatch reports. What's more, much of the firm's money comes from Cohen himself, who seems unlikely to commit his firm to the deep by redeeming all of his capital.

There is also, of course, the matter of performance, which has been historically excellent at SAC and continues to be so this year. According to MarketWatch, the firm's International fund is up 11.5% this year.

In Depth

Related-Company Fees: Normal Industry Practice or Conflicted Compensation?

Nov 11 2015 | 4:23pm ET

Regulatory agencies as well as investors are increasingly exploring whether certain...


Ferrari Roars in Wall Street Debut

Oct 21 2015 | 4:28pm ET

Shares of supercar maker Ferrari jumped as much as 15 percent to a high of nearly...

Guest Contributor

Private Debt - What is the Opportunity?

Nov 11 2015 | 3:28pm ET

In this contributed article, Rob Allard, founding partner of Firebreak Capital...


Editor's Note

    Oct 21 2015 | 10:41am ET

    One of the most unique charity benefits in the hedge fund industry, A Leg To Stand On's (ALTSO's) Hedge Fund Rocktoberfest - NYC, raised nearly $500,000 last Thursday thanks to the generous support of major sponsors and nearly 1,400 attendees from the Tri-State finance, business and hedge fund communities. Read more…