One of the biggest hiring coups in recent hedge fund history has not worked out terribly well for Moore Capital Management's investors.
Greg Coffey, who joined the New York-based firm three years ago from GLG Partners amidst great fanfare, has stepped down as manager of Moore's Emerging Markets Fund, which has posted below-average returns under Coffey's watch. But rather than part ways with Coffey, Moore is giving him something of a new start.
Coffey now runs an entirely new fund, GC Moore Emerging Macro, which launched with US$750 million, the Financial Times reports. In the new fund, Coffey need not worry about the US$100 million in illiquid assets that have weighed on the Emerging Markets Fund's performance, some of which were part of the portfolio before Coffey came on board.
Emerging Markets is still stuck with those illiquid assets. But its investors were given the option of moving to GC Moore, sticking with Emerging Markets, splitting their investments or redeeming entirely—without penalty. But those who stay in the Emerging Markets fund will now be permitted to redeem only once a year.
Moore founder Louis Bacon will manage the legacy fund himself. Emerging Markets has seen its assets under management dwindle from US$1.5 billion at the beginning of the year to "hundreds of millions" of dollars due to investor withdrawals, the FT reports.
Coffey said he hopes the new fund—which is already up 5% this month, compared to a 7% loss for the Emerging Markets fund this year—will allow him to focus on longer-term macro themes. GC Moore is not currently accepting outside investments.