Saturday, 27 August 2016
Last updated 3 hours ago
Feb 11 2011 | 8:15am ET
The impending closure of Shumway Capital has more than a few investors ticked off at founder Chris Shumway.
The firm's abrupt decision, announced last week, to return money to outside investors came after Shumway spent months trying to reassure investors that the firm's future was safe after he stepped down as its lead manager. Following Shumway's announcement in November that he would hand the reins of the $8 billion firm to his deputy, investors sought to redeem billions. But Shumway himself reached out to a number of major investors, including funds of funds, promising to delay the handoff and to reassure them about the future.
Those investors were then blindsided by last week's news, which has them looking "stupid, like they don't know what's going on," one pension consultant told Hedge Fund Alert.
"I fully understand this complication was brought on by the changes that I chose to make, and as such I feel responsible to correct this mismatch of investment style and investor needs," Shumway wrote. "The right decision for all of us is to return investor capital."