WSJ Profile: Victor Niederhoffer

Over the weekend the Wall Street Journal profiled hedge fund manager Victor Niederhoffer, whose funds have been taking some hits of recently.  His Manchester Trading LLC lost around $100 million in May or roughly 30%.  And his largest fund, Matador Fund Ltd, with around $250 million, is down around 12% through the end of June...

Victor Niederhoffer is a noted money manager with some quirks. For instance, he keeps the thermostat in his trading room set so high, you can see the sweat beading up on his traders' brows.

Recently, Mr. Niederhoffer has been feeling the heat in another way.

The hedge-fund firm he runs, Manchester Trading LLC, took a beating in May, when stock prices swooned. That month alone, the fund lost about $100 million, or almost 30% of its assets. There was speculation -- though it proved to be unfounded -- that he might have to close his firm. "We never discussed or had any thought of closing operations," says Mr. Niederhoffer.

It would have been a painful repeat of history for Mr. Niederhoffer: In 1997, he lost most of his personal savings after his previous hedge fund collapsed, partly under the weight of disastrous bets on foreign markets. That collapse made him a poster boy for overly aggressive investing.

"I had a bad May. I made some mistakes, that's regrettable," Mr. Niederhoffer says. "But one sparrow does not make a spring, and nor does one bad month.".

The losses continued in June, however, and Mr. Niederhoffer's largest hedge fund, Matador Fund Ltd., with about $250 million, was down 12% on the year through the end of June. That's worse than the gain of 4% for the Dow Jones Industrial Average through June and the 2% drop in the Standard & Poor's 500....

One Trader's Way To Make Money: Pile On the Risk - Wall Street Journal