SAC Capital Advisors has shut one of its trading units as the indicted hedge fund considers its future as a smaller firm.
Stamford, Conn.-based SAC closed Parameter Capital Management last week. The decision to ax the three-year-old unit came prior to SAC's indictment on criminal insider-trading charges last month.
Parameter co-founder Anil Stevens is leaving SAC with a team of eight or nine to start a hedge fund of his own, plans that have been in the works for some time, Reuters reports. The plans of Glenn Shapiro, who set Parameter up with Stevens in 2010, are unclear. For both men the past three years were a return to SAC; the two spent the interim period at Balyasny Asset Management.
Parameter focused on financial stocks. The unit had produced positive returns this year. It is not clear how much of SAC's $14 billion in assets the division managed.
SAC has denied any wrongdoing and pleaded not guilty to the insider-trading charges; prosecutors have agreed to allow it to continue operating as it fights the allegations. Still, outside investors—who have already filed redemption notices for about $5 billion this year—are expected to pull the roughly $1 billion they have left with the firm next week. And SAC is said to be mulling cutbacks, layoffs and combining business units, although President Tom Conheeney told employees in an e-mail Saturday that reports that SAC will shrink markedly are untrue.