Hedge Funds Dropping Like Flies: Doug Hirsch’s Seneca Capital Closing After 20 Years
by Tyler Durden
ZeroHedge.com
12/29/2015
Three weeks ago when news of the dramatic gating and liquidation of Third Avenue’s high yield debt focused fund first hit, we said that “now that the dreaded gates are back, investors in all other junk bond-focused hedge funds, fearing they too will be gated, will rush to pull what funds they can and submit redemption requests, in the process potentially unleashing a liquidity – and liquidation – scramble within the hedge fund community, which will first impact bonds and then, if the liquidity demands continue, equities as well.”
Sure enough, promptly thereafter several other junk-debt focused hedge funds shut down, culminating with yesterday’s liquidation of Whitebox’s various multistrategy mutual funds.
And now, moments ago we learned, another hedge fund has decided to call it quits, this time chess-afficionado Doug Hirsch’s event-driven $500 million Seneca Capital, which according to Bloomberg is returning most outside capital by today.
Bloomberg adds that “Seneca is returning money amid the worst year since 2011 for event-driven funds, which on average declined 2.3 percent through November. The closing adds to a roster of hedge funds, both big and small, that have shuttered in 2015 as the industry struggles to generate profits. LionEye Capital Management, another event-driven fund, is closing after losses, while BlueCrest Capital Management, Fortress Investment Group LLC and BlackRock Inc. are liquidating some of their funds.”
The Rest…HERE
