Pink Slips Fly on Hedge Row

Posted by: Matthew Goldstein on October 15, 2008

It’s been a bad year for hedge funds, with many posting their worst performances in years and wealthy investors threatening to redeem their money by year’s end. Now here comes another sign of distress in the $1.9 trillion hedge fund universe: layoffs.

On Oct. 14, two big hedge funds delivered pink slips to dozens of employees. Perry Capital recently laid-off up to 10 employees in the funds’ stock trading group. An even bigger shakeout occurred at Ramius Capital, where 40 staffers were pushed out. The downsizing was first reported by Hedge Fund Alert, an industry newsletter. A spokesman for Perry Capital, commenting on the layoffs says, the fund “sees unprecedented opportunity in the global credit markets that requires fewer equity professionals.’’ A Ramius spokeswoman, without commenting on the layoffs, points out the fund recently made several key hires in its credit trading group.

Reader Comments

me

October 15, 2008 12:39 PM

Judging by Perry Capital's -17% return YTD I would say they aren't doing very well with their tremendous plays in global credit.

Jennifer Brown

October 15, 2008 1:50 PM

This must have been a misquote from Perry's spokesperson, because Perry actually laid off over 30 staffers, almost their entire equities group, yesterday. Odd, considering that equities was performing better than credit. My friend who works there said that yesterday was a pretty nasty day and that the people left over are circulating their resumes.

You

October 15, 2008 5:55 PM

The manner in which it was done was unexpected and unprofessional; discreet was missing from the equation. Secrets don't exist at such a small firm everyone knows whats going on. Especially yesterday when the Ford assemblyline gave away who was going and who was staying.

Former Ramius Employee

October 18, 2008 1:28 PM

Actually, at Ramius Capital, I was laid off months ago, amid a lay off one here, another there. It's been going on for a while - laying off higher paid workers, bring in fresh talent - until they cut their Securities Lending department in half over the summer. They also overextended their operations budget, moving from 25k sq ft office to 75k sq foot office, with $30+ mln in buildout costs - all in this year with a plunging market. They should close shop the way they treat people.

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Bloomberg Businessweek’s Ben Steverman focuses on the latest moves in financial markets and emerging trends in stocks, bonds, and funds, always with an eye toward giving readers a better understanding of the sometimes confusing and often chaotic world of money. Standard & Poor’s senior index analyst Howard Silverblatt will also provide his take on companies’ finances and the markets. Voted one of the “Top 100 Finance Blogs” in 2007.

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