John Meriwether to shut HF after losses

Discussion in 'Wall St. News' started by turkeyneck, Jul 8, 2009.

  1. July 8 (Bloomberg) -- John Meriwether, who roiled global markets when Long-Term Capital Management LP collapsed in 1998, plans to shut his current hedge fund, according to a person familiar with the matter.

    JWM Partners LLC is closing its main Relative Value Opportunity II fund after losing 44 percent from September 2007 to February 2009. Meriwether, credited with generating billions of dollars of revenue at the former Salomon Brothers in the 1980s through so-called relative value trades, returned an average of 1.46 percent a year with his new fund since opening in 1999, compared with 2.4 percent for the Credit Suisse/Tremont Hedge Fixed-Income Arbitrage Index.
  2. 0008


    waste of time to talk about this guy!:D
  3. bidask


    the fund returned an average of 1.46% per year?

    what the hell? why not just buy CDs?
  4. This guy is a bigger stain on the hedge fund industry than Madoff. A con man of the first order.

    The folks who invest in these sort of things are idiots and he'll have another $5 billion raised for a new fund within 6 months.
  5. Ash1972


    You may have noticed that "Liars' Poker" is still in print and selling well. It's the best advert for JM & Co.

    LTCM? Come on, that was sooo long ago :)
  6. gaj



    the past 2-3 years have been sticking a fork in some of the most over-rated traders ever...
  7. good thing he's a genius, or he would have lost REAL money.
  8. you have a pic of Jack Hershey with a fork in him?
  9. Funny story...While I was working at a hedge fund several years back, our managing partner who invests in many different hedge funds had this guy come in with part of 'his team.' I was allowed to sit in, as I was damn interested in hearing what they had to say, have a little bit of quant in me, and to be a second set of eyes/ears.

    Long story short, they were essentially doing the same thing they did with treasuries/foreign bonds,etc except now they were using FNM/FRE CMO's. My managing partner basically said, "We'll get back to you" at the end of the meeting when I had asked the question (albeit in a somewhat softer manner) - What happens when you hit that 4 Std deviation event again? How do you manage that risk? Umm, not a good answer from what I can remember, and my boss never did invest capital with them.
  10. JWM blew up on a bunch of RV trades that all went sour last year. Specifically, quite a few bad positions in inflation space (UK and yen), as well as the infamous yen asset swap box debacle.

    So it's not like they did anything too exotic. The problem is the size of the positions that were perceived as safe.
    #10     Jul 9, 2009