Investors that have pulled money from SAC include the Blackstone Group, the world’s largest hedge fund investor; Ironwood Capital Management in San Francisco; and Magnitude Capital in New York. Notwithstanding the confident tone of Tuesday’s e-mail, many expect that SAC will have to cut back. Unlike many hedge funds controlled by one or two portfolio managers making investment decisions, SAC has about 140 small teams to which Mr. Cohen allocates money. The teams are paid as much as 25 percent of the profits that they make. Paying for this decentralized model are the high annual fees that SAC charges outside investors — a 3 percent annual management fee and 50 percent of the profits. Without the rich fees earned from managing other people’s money, Mr. Cohen would have to pay these teams himself.
Posted on: Thu, 06 Jun 2013 17:05:40 +0000
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