After being with the firm for 15 years, Jim Pallotta is leaving the $18 billion Tudor investment Corp according to a letter sent to investors on Wednesday. Hedge funds managed by Pallotta will be spun off of Tudor Investment at the end of the year. Currently around $7 billion of the the Tudor funds are managed by Pallotta, including the Raptor fund which has experienced negative returns (including an 8% loss so far this year) and major withdrawals since the credit crunch started last year. Raptor and other funds including Altar Rock, will still be controlled by Pallotta, and he'll also continue to manage part of Tudor's BVI fund.
Tudor clients were told in the letter to expect more information "on Jim's new business and on operational aspects of the transition as decisions are made and as more details are available." The letter was signed by Mr. Jones, Mr. Pallotta and Mark Dalton, who is Tudor's president.
Raptor peaked at about $9 billion in assets last year but has shrunk to about $5 billion as bets soured and investors pulled money. Hurt by bets on energy stocks, Raptor has lost about 8% year-to-date, after losing about the same amount of ground during 2007.
Prior to 2007, Mr. Pallotta's stock-picking consistently helped Tudor post some of the best returns in the industry and made billions of dollars for investors. Before its troubles started last year, Raptor delivered about 19% annual returns, on average. During the same period, BVI gained about 24% a year, on average, since 1986. Losses from stock bets were a drag on BVI's performance during 2007.
Tudor's Pallotta to Leave Firm - Wall Street Journal
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