Scout To Close, Return $6.7 Billion

Jan 30 2014 | 2:50pm ET

Hedge fund Scout Capital Management will close after its co-founders decided to part ways.

The shuttering of the 15-year-old New York-based firm comes after co-founder Adam Weiss decided to stop managing client capital. Co-founder James Crichton plans to found a new hedge fund to continue to do so.

Scout will return 95% of its $6.7 billion in assets by the beginning of April, it told investors yesterday. The firm has laid off 23 of its 37 employees, with the rest to go over the next six months as the firm winds down.

"After much soul searching, Adam has decided to step back from the management of outside capital," Weiss and Crichton wrote. "Because James intends to manage outside capital in the future, we have arrived at a crossroads for Scout."

While the two sought to find a way to keep the fund open while changing their roles, "we were unable to come up with an effective plan to manage the existing funds through such a significant change without imposing unnecessary risks upon you," the two wrote. "We are grateful beyond measure for the opportunity you have afforded us to serve you for all these years."

Weiss, who moved to California four years ago for personal reasons, plans to write a book about investing and run a family office. Crichton said his new firm may feature some Scout veterans.

Scout returned 21% last year and has posted annualized returns of 14% since inception in 1999.

Crichton and Weiss met at Donaldson Lufkin & Jenrette. The former had previously worked at Zweig-Dimenna Associates, and the latter at Third Point.


In Depth

Q&A: Neil Azous Talks Global Macro Investing

Nov 24 2014 | 12:41pm ET

Neil Azous is the founder and managing member of Rareview Macro, an advisory firm...

Lifestyle

Griffin Selling Chicago Apartment

Nov 26 2014 | 11:40am ET

Citadel Investment Group’s Kenneth Griffin is making clear to his estranged wife...

Guest Contributor

Why The Big Money Is Going To Europe

Nov 14 2014 | 6:03am ET

Peer-to-peer lending was invented with the individual investor in mind. But despite...

 

Sponsored Content

    For Hedge Funds, Mastering Data Is Key To Success

    Nov 4 2014 | 9:45am ET

    Data management is important to every business, but for hedge funds, it is critical. FINalternatives recently asked Peter Sanchez, CEO of Northern Trust Hedge Fund Services, how fund managers can deal with the demands of managing data while at the same time remain transparent and abide by operational best practices. Read more…

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

November 2014 Cover

Building a better market

Reg NMS created a huge bifurcation in equity markets and while much of what has followed has been positive, in terms of lower fees and greater liquidity, many traders would like to see the market come...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.