Running a Hedge Fund “Aint What It Used to Be”

October 10, 2018 James Heinsman Hedge Fund News

After several decades of bringing home millions of dollars for himself and his clients, Jonathan Jacobson founder of Highfields Capital Management has decided its time to shake things up a bit. Here is how he described how burnout feels in the upper atmosphere:

“Done correctly, money management is an all-consuming, 24/7 pursuit… After three-and-a-half decades of sitting in front of a screen, I realized I am ready for a change,” Mr. Jacobson, 57 years old, wrote. “The tell was that I simply could not pull the trigger on making a multi-year commitment to a few potential key hires.”

Jacobson will be returning his client’s money, worth billions, in a move that is one of the largest shuttering of a hedge fund in recent times. The firm was launched in 1998 after Jacobson left his job trading securities for the endowment at Harvard University. Harvard was Jacobson’s first client at Highfields.

It isn’t just burnout that is motivating Jacobson to convert the firm to a family office. Its also the bad results that most hedge funds can’t seem to shake these days. So far this year, up until the end of August, Highfields earned 2.3%, not so good compared to the S&P’s 10% return.

“Our 2018 results and those of the last few years have clearly not met either my expectations or yours,” added Jacobson. “While it has been, and continues to be, a very treacherous investment environment, and certainly not one very friendly to our style of investing, it is what it is, and no one feels worse about our lagging performance than I do.”

Highfields is joining several other well-known funds that have recently pulled down the curtains, including Eric Mindich’s $7 billion firm Eton Park Capital Management LP in 2017 and Richard Perry’s hedge-fund in 2016.

Eric Mindich, Eton Park Capital Management, Highfields Capital Management, Jonathan Jacobson,

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