Tudor Investment Corp. has suspended redemptions from its flagship hedge fund and announced plans for a restructuring. It's the latest hedge fund to freeze assets amidst one of the worst years for hedge funds in history.
The Greenwich, Conn.-based hedge fund, which generally offers quarterly redemptions, told investors that they would be barred from withdrawing their money from the $10 billion BVI Global Fund until March 31. In the interim, the firm plans to proffer a plan to split the fund in two, with investors voting on the proposal early next year.
Tudor had received redemption requests totaling $1.4 billion of its assets for Dec. 31, despite relatively strong performance. BVI is down just 5% in a year when most hedge funds are down by double-digits.
“While Tudor BVI currently has more than $6 billion in cash, this redemption level has led us to examine the fund’s liquid and illiquid positions as it relates both to making redemption payments and to the future direction of the fund,” Tudor founder Paul Tudor Jones told investors in a letter.
Under the proposal, BVI will be split into two share classes. The so-called “Legacy Share Class” would be something a side-pocket, housing the fund’s most illiquid investments, which make up 29% of the fund’s assets, and featuring tighter redemption rules. The new “Tudor BVI Share Class” would hold the fund’s more liquid investments.